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Japan supported by U.S. ag to join Pacific trade talks

Rich Keller, Editor, Ag Professional | Updated: 03/15/2013

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Japan will seek to join negotiations for a wide-ranging, multilateral free-trade pact with the United States and other Pacific nations, and agricultural associations in the U.S. are supportive of the move.

Prime Minister Shinzo Abe said Friday that Japan wants to be involved in Trans Pacific Partnership (TPP) trade talks that could include countries having 40 percent of the world’s gross domestic product.

Within Japan there are reservations about becoming involved, including the country’s farmers. Outside of Japan, reports are that some countries see demands by Japan as disrupting progress that could be made much faster without Japan’s involvement.

The New York Times reported during a television appearance in Japan that “Abe portrayed the Trans-Pacific Partnership as Japan’s ‘last chance’ to remain an economic power in Asia and shape the fast-growing region’s economic future.” He stressed that Japan has to seize this “last chance” to remain a center of trade and growth in the Asia Pacific region.

“With strong opposition from Japan’s farming lobby and other powerful interest groups, Mr. Abe takes a big political risk in embracing the free-trade talks. Japan’s largest agricultural cooperative has actively campaigned against trade liberalization, saying such a change would decimate the nation’s farms, a plea that has resonated among the wider public. Within his own Liberal Democratic Party, a majority of lawmakers depend on the rural vote and object to the free-trade deal,” reported Hiroko Tabuchi for The New York Times.

Complicating the move to join the TPP is that Abe apparently has tried to begin back-room negotiating, mainly with the U.S., so that certain businesses, especially Japanese agriculture could be protected. An example is protection of Japan’s rice farmers by maintaining an extremely high tariff after a minimal amount of rice is allowed into the country. The average agricultural products tariff is 25 percent, a higher average than most countries in the negotiations. Japan’s agricultural cooperatives and other interest groups have teamed up to oppose a free trade partnership as a threat to the Japanese lifestyle.

Exclusions from negotiations by Japan is part of the concern by those countries already talking and why there is worry that progress could be slowed and negotiations complicated. Japan is also a leader in imposing extreme regulations for import and export.

Countries that have been talking seem to be fairly happy with the progress occurring without Japan.

The high goal of the TPP is for completing a comprehensive pact that covers not just trade in goods and services, but also foreign investment, government procurement, intellectual property rights and environmental and labor protections.

Even though agricultural import and export are sticking points in dealing with Japan, U.S. agricultural farm organizations were quick to support Japan’s entry into the negotiations—with stipulations.

The American Farm Bureau Federation in a statement issued by President Bob Stallman said, “As the fourth-largest U.S. agricultural export market, with nearly $14 billion in purchases in 2012. Japan is crucial to America’s farmers and ranchers. Both the United States and Japan will benefit from Japan being a TPP partner, and by sharing in improved sanitary and phytosanitary standards for agricultural trade and expanded market access with TPP nations.”

But Stallman did suggest the exclusions from negotiations such as agricultural products would be a mistake. “It’s important that new entrants to the TPP recognize this is a comprehensive agreement and that individual sectors should not be excluded from the negotiations.”

The USA Rice Federation also welcomed Prime Minister Abe’s announcement of joining the current 11 nations of the TPP, but also said agricultural products should not be excluded from negotiations. The federation noted that Japan ranks as the number two market for U.S. rice with $242 million of U.S. rice shipped to Japan in 2012. Even with restricted access for export, Japan has been around 9 percent of total U.S. rice exports in recent years.

Mark Denman, USA Rice chairman and a Texas rice miller, said, “Japan is a vital export market for U.S. rice. As the United States and other TPP partners consider Japan’s application, it must be clear that all products, including rice, be on the negotiating table as a condition for Japan’s entry into the trade negotiations.”

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