US gives Japan nod for mega trade pact

WASHINGTON, USA – The United States gave Japan the green light on Friday, April 12, to enter talks on a Pacific trade agreement, in the latest step forward for a pact that would account for 40% of the global economy.

The two countries announced an agreement for Japan to enter negotiations on the 11-nation, US-backed Trans-Pacific Partnership, despite opposition from Japan’s powerful farmers and from some US manufacturers and labor groups.

“I want our participation in the negotiations to come into force quickly so we can play a critical role in defining the rules” of the pact, Japanese Prime Minister Shinzo Abe told reporters in Tokyo.

Under the rules of the Trans-Pacific Partnership, all 11 nations engaged in the negotiations must approve Japan’s participation. Japan must still win over Australia, Canada, New Zealand and Peru.

In Washington, acting US Trade Representative Demetrios Marantis said that the US reached understandings with Japan on key concerns including on the automotive and insurance sectors.

“Japan’s entry into this important initiative for the Asia-Pacific region will help it to deliver significant economic benefits to the United States, Japan and the Asia-Pacific region,” Marantis said in a statement.

Addressing the concerns of US automakers who fear intensified competition, Marantis said that Japan had agreed that US tariffs on Japanese cars would be phased out at the latest possible time under a potential future deal.

Japan also agreed that the tariffs would still “substantially exceed” the levels in the free trade agreement between the United States and South Korea that went into force in March 2012 after exhaustive talks on car imports.

President Barack Obama has championed the Trans-Pacific Partnership as a way to boost the US economy through trade and to build a US-backed order in a fast-growing region where China — which is not part of the talks — is gaining clout.

Abe, despite criticism from members of his party and rural constituents, has embraced the Trans-Pacific Partnership as a way to ensure that the world’s third largest economy stays relevant amid the rapid changes in Asia.

Critics say that few details are known about the proposed deal and worry that it will benefit multinational corporations at the expense of labor and social protections afforded by each country.

Nations in the talks that have approved Japan’s participation are Brunei, Chile, Malaysia, Mexico, Singapore and Vietnam. – Rappler.com