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U.S. withdrawal from TPP alarms Japan’s producers

Since the Trans-Pacific Partnership Agreement (TPP) became unenforceable in the current framework on Jan. 20, people working in the related industries in Japan have felt disappointment and alarm. Voices have also been heard that accuses President Trump’s unilateral decision as “self-centered.”

 

  • “President Trump is acting in disregard of others. He is only concerned about American profits,” says a worker at a Tokyo auto-parts maker whose products are used in engines by a major truck manufacturer. His company had expected an increase in truck exports, thus more orders, as a result of tariff reduction by countries such as Vietnam under the TPP. The worker is wary of the possibility that the U.S. president will target Japan and set a higher tariff. Now the company is looking into diversifying its business in order to decrease its heavy reliance, up to 70%, on sales of engine parts.

 

  • In Aichi Prefecture, the location of Toyota and numerous auto-parts makers, there are many who are worried about the consequence of the U.S. withdrawal from the TPP. A president of one of the auto-parts manufacturers confessed, “For now, we will refrain from forward looking capital investment. We will have to conduct our business with caution and prudence. This will probably affect downstream contractors as well.” 

 

  • A rice farmer from Aomori Prefecture wonders, “What were all the discussions about the TPP for?” Instead of feeling threatened by the trade pact, he had been preparing his farm for exporting to the large U.S. market, where Japanese cuisine is currently very popular. “From now on, through a bilateral trade negotiation, the U.S. may urge Japan to increase the import of cheaper rice,” he says. Next year, he plans to double his acreage under cultivation. “We will compete in quality, not in quantity. We will find a way to be able to makea profit under any circumstances.”

 

  • A breeder of world-famous Kobe beef in Hyogo Prefecture is disappointed. “We were hoping for an opportunity to increase beef exports under the TPP.” For several years now, the farmer has been expanding sales of his beef in overseas markets including the U.S. He says, “I understand that the decision (to withdraw from the TPP) reflects what the American people want, but still, this a 180 degree change of policy with a word from the president that is not easy to swallow.”

 

  • In Sapporo City, Hokkaido, a manager of a company that breeds about 900 pigs is happy with the turn of events. “We welcome the collapse of the TPP,” he says. The company was concerned that if enacted, the item under the TPP which stipulates the step-by-step reduction of the tariff on pork would threaten its business. Nevertheless, uncertainty remains. “In the future, the U.S. may demand bigger concessions from Japan than what was promised in the TPP. I hope pork will not become a bargaining chip when the governments of the two countries negotiate tariffs on agricultural and livestock products.” (Abridged)
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