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Editorial: Japan, U.S. make free trade a key plank in new trade talks

Prime Minister Shinzo Abe and U.S. President Donald Trump have agreed to set up a new framework for bilateral trade negotiations. The views of the two nations are wide apart as they move into the new talks, but it will become important to facilitate the talks based on free trade.


The U.S. wants to achieve quick results in bilateral talks by using the tariff sanction as a threat before the midterm elections for the U.S. Congress in November. On the other hand, Japan wants to emphasize the Trans-Pacific Partnership free trade and other multilateral trade mechanisms to avoid a resurgence of trade friction in individual fields. The new trade talks will start amid conflicting views between the two nations.


At the first Japan-U.S. summit held in February 2017 following the inauguration of the Trump administration, Tokyo and Washington agreed to launch a Japan-U.S. Economic Dialogue led by Deputy Prime Minister and Finance Minister Taro Aso and Vice President Mike Pence, respectively. The Japanese side hoped to deflect attention from individual bilateral trade issues by dealing with a wide array of economic topics, such as energy and infrastructure.


The Japan-U.S. Economic Dialogue was convened twice last year, but no tangible results were produced. Discontent was building up on the U.S. side in the belief “the meetings might be aimed at buying time.”


The new framework for bilateral trade talks was proposed by Japan, and the U.S. agreed to it. This will be led by Minister for Economic and Fiscal Policy and Economic Revitalization Toshimitsu Motegi and United States Trade Representative Robert Lighthizer, suggesting that Japan and the U.S. will hold more pragmatic discussions.


In March, the U.S. introduced import curbs on steel and aluminum for the reason of national security. The restrictions cover not only China but also Japan. Prime Minister Abe called for making Japan an exemption, but President Trump did not yield, saying that he would determine whether to exempt Japan based on progress to be made in the bilateral talks. Furthermore, he criticized U.S. trade deficits with Japan and reiterated that trade barriers still linger in the Japanese auto market.


How should Japan deal with the U.S., which is looking to produce quick results? In the 1980s and 1990s, when trade friction between Japan and the U.S. intensified, Japan adopted self-imposed export restrictions. This time it should not resort to such measures to control trade. 


It would be best if Japan can encourage the U.S. to return to the TPP and broaden the free-trade sphere in the Asia-Pacific region. But the Trump administration will not soon agree to this, as it advocates bilateral trade. When Japan and the U.S. enter bilateral talks in fields such as autos and agriculture, they should use what they agreed upon during the TPP talks under the Obama administration as a benchmark.


Japan and the U.S. can work together in many fields such as China’s intellectual property theft. Japan should convey the importance of free trade to the U.S. and make the new trade talks more constructive.

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