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Editorial: Japan should start by clarifying scope of target fields in trade talks with U.S.

Japan and the U.S. will hold their first ministerial-level trade talks in Washington in April.


It has been more than seven months since the two countries agreed to begin negotiations for a bilateral trade agreement on goods (TAG) at the summit in September last year. It is hoped that the planned talks will be founded on international-rules-based free trade and produce results that will expand foreign demand in Japan.


During the seven months or so, the Trans-Pacific Partnership free trade deal signed by 11 countries without the U.S. took effect. Also, the Regional Comprehensive Economic Partnership (RCEP), which is joined by 16 countries, including Japan, China, South Korea, and member countries of the Association of the Southeast Asian Nations (ASEAN), has entered the stage of eyeing the conclusion of the pact within the year.


It is natural to aspire to the expansion of a free trade bloc in the Asia-Pacific region, where economy, driven by population increase, continues to grow. We hope Japan will negotiate with the U.S. by firmly maintaining its position to expand the membership of the TPP, which stipulates a wide range of rules spanning from intellectual property to investment, in addition to reducing and eliminating tariffs on agricultural and industrial products.


Cause for concern is U.S. President Donald Trump, who is strengthening his “America First” approach in domestic affairs, security, and other important policies, particularly in the trade area. What lies in the background of this is perhaps the divided U.S. Congress, where the Democrats hold a majority in the House as a result of he mid-term elections.


The President’s Economic Report released by President Trump in March described new trade talks with Japan as a “free trade agreement (FTA).”


Japan has explained that trade negotiations with the U.S. will be limited to tariffs on agricultural products and other goods. But it is safe to say the U.S., which has been in a disadvantageous position in the trans-Pacific region since its exit from the TPP, is planning to secure access to a wide range of markets including services.


Concerns remain, as indicated by the U.S.’s “bilateral negotiations” with China and the EU, that the U.S. will force its trade partners to swallow a “deal” under which they are forced to buy a massive amount of American products under threat of high tariffs on their major export items as a bargaining chip.


It is vital to clarify the scope of target fields before launching negotiations. It would be advisable to tamp down in advance political expectations by President Trump, who seeks reelection in November next year, in order to secure Japan’s national interest.


Japan particularly needs to pay attention to the auto field, its key industry. The U.S. is the largest importer of Japanese cars. If the U.S. takes hard-line measures, it will not only affect the auto industry but inevitably the entire Japanese economy.



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