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Japan labors to add ‘fair’ and ‘reciprocal’ angle to free trade

New ‘FFR’ talks with US to begin in June, but goals are far apart

 

TOKYO — Although Japan and the U.S. will begin new “free, fair and reciprocal” trade talks soon, the two countries share little common ground as Washington tries to score a bilateral deal while Tokyo holds out for the original TPP.

 

Dubbed the “FFR” talks by officials on both sides, the discussions agreed to by Prime Minister Shinzo Abe and President Donald Trump last week will be held some time after the end of June. 

 

The Japanese side has requested the launch to be withheld until that time in order to give Japan’s parliament time to ratify the 11-nation Comprehensive and Progressive Agreement for Trans-Pacific Partnership.

 

The negotiations will be led by Japanese Economic and Fiscal Policy Minister Toshimitsu Motegi and U.S. Trade Representative Robert Lighthizer as part of the economic dialogue under Deputy Prime Minister Taro Aso and Vice President Mike Pence.

 

The Trump administration wants the talks to yield a free trade agreement since it believes bilateral deals give it stronger bargaining power. Trump’s insistence on reciprocity reflects his desire for Japan to reduce trade barriers.

 

“Let’s make a good deal,” Motegi told Lighthizer at the Trump-Abe summit. But Tokyo will encourage Washington to rejoin the TPP, which it believes would resolve such U.S. demands as lower beef tariffs, through the new talks. To Japan, a good deal means the TPP.

 

Tokyo and Washington also disagree about when to conclude the talks. The American side wants to wrap up the dialogue before the U.S. midterm elections in November. But Japan wants negotiations to last until after the TPP 11 goes into effect and wait for the U.S. to rejoin in the future.

 

“I hope for discussions that lead to an agreement in line with our national interests,” Chief Cabinet Secretary Yoshihide Suga said at a press conference on Monday.

 

The decision to initiate new talks was also sudden. “We don’t know how prepared the Office of the U.S. Trade Representative is” to start the discussion, said a Japanese government official.

 

The Cabinet Secretariat office responsible for TPP negotiations is likely to lead the new talks for Japan, and it is currently trying to gauge the actions of the U.S. The pressure on Motegi, who Trump has called “tough,” is high.

 

Starting in the late 1980s, Japan and the U.S. engaged in economic talks called the Structural Impediments Initiative, or SII, to dismantle Japan’s trade barriers. Just as SII made daily headlines back then, FFR is expected to be a key phrase in the trade negotiations going forward. 

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