Professional Documents
Culture Documents
he world is awash in trade negotiations. The 12-member Trans-Pacific Partnership is the most
important of them all, with vast economic potential as it could set new standards for commercial
integration. The geopolitical benefits to a successful TPP are perhaps even more important. The key
is whether a few of the large TPP countries can negotiate a balanced package.
TPP
ECONOMY
AND THE OF
POLITICAL
U.S.-JAPAN
ECONOMY
TRADE OF
NEGOTIATIONS
U.S.-JAPAN TRADE NEGOTIATIONS
1 TPP AND THE POLITICAL
1
TPP
ECONOMY
AND THE OF
POLITICAL
U.S.-JAPAN
ECONOMY
TRADE OF
NEGOTIATIONS
U.S.-JAPAN TRADE NEGOTIATIONS
3 TPP AND THE POLITICAL
3
TPP
ECONOMY
AND THE OF
POLITICAL
U.S.-JAPAN
ECONOMY
TRADE OF
NEGOTIATIONS
U.S.-JAPAN TRADE NEGOTIATIONS
5 TPP AND THE POLITICAL
5
TPP
ECONOMY
AND THE OF
POLITICAL
U.S.-JAPAN
ECONOMY
TRADE OF
NEGOTIATIONS
U.S.-JAPAN TRADE NEGOTIATIONS
7 TPP AND THE POLITICAL
7
TPP
ECONOMY
AND THE OF
POLITICAL
U.S.-JAPAN
ECONOMY
TRADE OF
NEGOTIATIONS
U.S.-JAPAN TRADE NEGOTIATIONS
9 TPP AND THE POLITICAL
9
10
TPP
ECONOMY
AND THE OF
POLITICAL
U.S.-JAPAN
ECONOMY
TRADE OF
NEGOTIATIONS
U.S.-JAPAN TRADE NEGOTIATIONS
11TPP AND THE POLITICAL
11
12
TPP
ECONOMY
AND THE OF
POLITICAL
U.S.-JAPAN
ECONOMY
TRADE OF
NEGOTIATIONS
U.S.-JAPAN TRADE NEGOTIATIONS
13TPP AND THE POLITICAL
13
14
Conclusion
The stakes and hurdles for success are
high. Thus far, contrary to the hopeful
predictions of negotiators for the past three
years, the required reforms and negotiating
concessions are still to be had. One can
remain highly optimistic that over time
success will come. If success is not found in
early 2015, the shadow of election politics
in the United States and Japan, and other
nations, will hang darker and success will be
even more difficult.
TPP
ECONOMY
AND THE OF
POLITICAL
U.S.-JAPAN
ECONOMY
TRADE OF
NEGOTIATIONS
U.S.-JAPAN TRADE NEGOTIATIONS
15TPP AND THE POLITICAL
15
NOTES
1
2
3
4
6
7
8
9
10
11
12
13
14
15
16
17
18
19
Bruce Stokes, Is America dangerously divided? Special to CNN, June 15, 2014.
Inside U.S. Trade, June 6.
Speech, June 10, 2014, Center for Strategic and International Studies (CSIS).
We must do everything possible to prevent the American marketplace from being flooded with imports
manufactured by workers laboring without human dignity and individual rights, the Democratic lawmakers
wrote in a letter sent to U.S. Trade Representative Michael Froman. In addition, Advocacy group Public
Citizen and the Communications Workers of America (CWA) labor union are leading the grassroots campaign
against TPP and Trade Promotion Authority (TPA). They are joined by a coalition of Congressmen, primarily
Democrats. A confidential letter signed by 67 sent to President Obama on May 3, 2012, urged him to exclude
from TPP any waiver of the Buy American Act.
For a clear summary of the many outstanding issues in the TPP that need resolution, see Henry Farrell, The
U.S. is Isolated in the Trans-Pacific Partnership Negotiations, The Washington Post, November 18, 2013, and
Gabrielle Chan, Trans-Pacific Partnership: a guide to the most contentious issues, The Guardian, December
9, 2013.
Tomomi Inada, Japans Breakthrough in its Economic Revitalization. Speech at Peterson Institute, January 13,
2014. For a critical view of progress, see Richard Katz, Voodoo Abenomics, Foreign Affairs, July/August, 2014.
Jemma Kim, Japan and the Trans-Pacific Partnership (TPP): Rule Setter or Follower? Journal of Asia-Pacific
Studies, August 2013.
Japan Times, May 30, 2014, at: http://www.japantimes.co.jp/opinion/2014/05/30/commentary/japan-commentary/tpp-no-longer-about-free-trade/#.U6W3O9y4lFK
The TPP is unlikely to be the defining issue for many Japanese voters. According to NHK News 7 on November
26, 31 percent of voters are in favor of Japan participating in the TPP, 16 percent are against, and 44 percent
do not hold a strong view either way. Voters rate other issues as far more important, including the economy,
social security, and nuclear power. Jemma Kim, Japan and the Trans-Pacific Partnership (TPP): Rule Setter or
Follower? Journal of Asia-Pacific Studies, August 2013.
For a good discussion of Japans broader FTA strategy, see J. Nakagawa and Wei Liang, A Comparison of FTA
Strategies of Japan and China and their Implications for Multilateralism, presented at the Annual Meeting of
the International Studies Association, San Diego, CA, April 1-4, 2012.
Mulgan, G. A. 2008. Japans FTA Politics and the Problem of Agricultural Trade Liberalisation. Australian
Journal of InternationalAffairs 62 (2): 164178.
The Food Department of the Ministry of Agriculture, Forestry, and Fisheries has the exclusive right to import
rice, wheat, and barley within those TRQs, and the Agriculture and Livestock Industries Corp (ALIC) has exclusive importing rights to two of the biggest dairy TRQs. The government, through the state-trading enterprises,
decides how much to import, when to import, and at what price to resell the imports into Japans market.
Japan Times, May 30, 2014, at: http://www.japantimes.co.jp/opinion/2014/05/30/commentary/japan-commentary/tpp-no-longer-about-free-trade/#.U6W3O9y4lFK.
The Latest Progress and Achievements of the Abe Administration. January 2014, ppt, at: http://japan.kantei.
go.jp/ongoingtopics/pdf/2014/140422_abenomics_rev.pdf
Yashiro Naohiro, Reforms as the Key to a Successful Growth Strategy, Nippon, November 21, 2013, http://
www.nippon.com/en/in-depth/a02501/.
Michael Auslin, Japans TPP Fight Has Just Begun, American Enterprise Institute, March 22, 2013, http://
www.aei.org/article/foreign-and-defense-policy/regional/asia/japans-tpp-fight-has-just-begun/.
Michael Auslin, Japans TPP Fight Has Just Begun, American Enterprise Institute, March 22, 2013, http://
www.aei.org/article/foreign-and-defense-policy/regional/asia/japans-tpp-fight-has-just-begun/.
The Latest Progress and Achievements of the Abe Administration. January 2014, ppt, at: http://japan.kantei.
go.jp/ongoingtopics/pdf/2014/140422_abenomics_rev.pdf
Japan formally announced its intention to join the TPP trade talks on March 13, 2013, less than three months
16
20
21
22
23
24
25
26
27
28
29
30
31
after Prime Minister Abe took office. To obtain U.S. support, Japan agreed to bilateral discussions on several
outstanding issues, resulting in a series of agreements on automobiles, insurance and non-tariff trade barriers. On April 12, 2013, the U.S. announced it would support Japans participation, and eight days later, the
country was invited by TPP members to join the negotiations
The trigger is imports less than the yearly average of Australian exports to Japan over past five years. In fact,
it is trade control, rather than trade liberalization: a tariff quota system setting Australian beefs share in the
Japanese market that maintains current protection for Japanese farmers as well as protecting Australian beef
from other importers in the Japanese market. Similar tariff quotas are also applied to cheese, frozen yogurt
and ice cream imports. Moreover, food producers importing cheese and cocoa preparations at low duties are
required to use domestically produced ingredients to certain percentages.
Eric Johnston, Why Kansais corporate captains are trumpeting TPP, Japan Times, May 17, 2014.
Vietnam will almost certainly join the fight on rice, since it strongly opposes Japans efforts to protect this sector. The rice industry employs 60 percent of Vietnams labor force, and in 2012, total rice output reached 44
million tons. Rice is also the countrys second-largest export product, comprising nearly 30 percent of its total
exports. Since Vietnam does not presently enjoy access to Japans market, it has been particularly aggressive
in opening up this sector. It will likely be supported by the U.S., whose large, efficient agribusinesses currently
export 360,000 tons of rice to Japan each year. However, in the parallel negotiations, the U.S. and Japan have
already discussed the possibility of retaining the high rice tariffs in exchange for increasing the import quotas.
Moreover, New Zealand and Mexico are not major rice producers. All of New Zealands rice is currently
imported, and while it seeks to obtain a high trade liberalization rate from all countries in the TPP, it has said it
will support Japan in exchange for a favorable agreement on beef and dairy. In Mexico, annual rice production
has fallen to 260,000 tons, most of which is consumed domestically. It is currently seeking tariff elimination
on its main agricultural exports to Japancorn, oranges, tomatoes, and coffeeas well as lower non-tariff
barriers for its automotive exports.
Farming in Japan: Field Work. The Economist. 13 Apr. 2013.
Declining rice consumption and high returns to rice farming have meant that production has threatened to
exceed consumption in most years since the 1960s. In recent years, about 30 percent of Japans rice paddy
area has been diverted. Diversion payments varied according to the crop or land use that the farmer chose.
The payments were substantial, with $920 per hectare the base payment for converting to wheat, barley, or
soybean production. See: http://www.ers.usda.gov/topics/international-markets-trade/countries-regions/
japan/policy.aspx#.U61fH9y4lFI
U.S. Rice Producers Signal Flexibility On Japan Market Access In TPP. Inside U.S. Trade. 16 April. 2013. Rice
was excluded from the US-Korea FTA.
The Latest Progress and Achievements of the Abe Administration. January 2014, ppt, at: http://japan.kantei.
go.jp/ongoingtopics/pdf/2014/140422_abenomics_rev.pdf
Generally see, The Bitter Taste of Sugar Protectionism: How Congress and the U.S. Sugar Industry Kill Jobs,
Raise the Cost of Living for Americans, and Compel U.S. Companies to Move Overseasas, at: http://www.cato.
org/multimedia/events/bitter-taste-sugar-protectionism-how-congress-us-sugar-industry-kill-jobs-raise
Takada, Aya, and Yasumasa Song. Japan May Open Beef in TPP Trade Talks, Former Adviser Says. Bloomberg.
15 Mar. 2013.
Olmsted, Larry. Kobe And Wagyu Beef: Final Thoughts And Clarifications. Forbes. Forbes Magazine, 19 Apr.
2012.
Obara, Kakuyu, Michael McConnell, and John Dyck. Japans Beef Market. USDA, Aug. 2010.
Cris Clague, Special Report: Japan, TPP and Agriculture, Promar Consulting, December 2011. At: http://
www.promarconsulting.com/site/wp-content/uploads/files/Special_Report_03_Japan_TPP_Agriculture.pdf.
Viewed July 8, 2014.
TPP
ECONOMY
AND THE OF
POLITICAL
U.S.-JAPAN
ECONOMY
TRADE OF
NEGOTIATIONS
U.S.-JAPAN TRADE NEGOTIATIONS
17TPP AND THE POLITICAL
17
32
33
34
ALIC falls under the MAFF and responsible for controlling imports of diary, sugar and starch. Its primary
duty is to maintain prices by buying and selling stocks of the commodities. Wheat, barley and rice TRQs are
managed by MAFF.
New Zealand, U.S. Share Common Interest In Japans Ag Market. Inside U.S. Trade, May 2013.
Economic Report of the President, 2014, Chapter 8, p. 246. Organic food revenues grew from $3.6 billion a
year in 1997 to $21.1 billion in 2008 and $31.4 billion in 2011. Per capita food expenditures rose from $3,600
per year to nearly $4,300 per year by 2011.
AUTHORS
Robert Rogowsky is Professor and Chair of the Masters degree program in Trade and
Economic Diplomacy at the Monterey Institute for International Studies and Adjunct Professor of Trade
and Economic Diplomacy at Georgetown Universitys School of Foreign Service. He is Visiting Professor,
University of Business and Economics, Beijing; and President of the Institute for Trade & Commercial
Diplomacy. Professor Rogowsky served as Chief Economist and Director of Operations at the U. S.
International Trade Commission. He served on the Presidents Performance Improvement Council
and on the Board of the U.S. International Trade Data System. Professor Rogowsky also served as
Deputy Director, Bureau of Consumer Protection of the Federal Trade Commission, as Acting Executive
Director to the Consumer Product Safety Commission, and as a litigation economist for the Bureau of
Economics, FTC. He received his Ph.D. in economics from the University of Virginia.
Gary Horlick is a partner at the Law Offices of Gary W. Horlick. He provides global business,
investment, regulatory and negotiating advice to U.S. and international clients. He is a former head of
the U.S. Department of Commerce Import Administration, where he was responsible for the administration of U.S. antidumping and countervailing duty laws and decided major cases involving Europe,
Brazil, Korea, South Africa, Canada, Mexico, Japan, India and others; supervision. In addition, he served
as international trade counsel to the U.S. Senate Committee on Finance. Horlick was the first chairman
of the World Trade Organizations permanent group of experts on subsidies. He has been recognized as
the worlds leading practitioner in the field of trade and customs law in each edition of Whos Who of
International Trade and Customs Lawyers since 1998.
18
ASIA PROGRAM
Woodrow Wilson International Center for Scholars
One Woodrow Wilson Plaza
1300 Pennsylvania Avenue NW
Washington, DC 20004-3027
www.wilsoncenter.org/asia