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Will they or won’t they? The question of the TPP

15/3/2013

 
PictureSource: 1topi.jp
Today (Friday 15 March), the Abe Cabinet is expected to announce Japan’s involvement in negotiations for the creation of a trade bloc spanning the Asia-Pacific, unencumbered by tariffs or other protectionist measures, and focused on improving trade flow between each of the participating countries (J). Given the fact that Japan has taken nearly four years to reach this point, one can understand Osaka Mayor Hashimoto Toru’s comment (J) during the week that this really isn’t the time for the LDP to suddenly be making a host of conditions for Japan’s involvement, especially since negotiations have reached the sixteenth stage and are getting closer to being finalised (with some reports stating that October this year would see the end of negotiations).

One gets the impression that Abe’s statements about “sacred grounds” exempt from TPP conditions and negotiations with the US for other possible exemptions are merely an attempt to distract the agricultural lobby, giving them the hope that some of their industries will not be affected by the TPP and thus prompt their acceptance of the agreement. However, it doesn’t seem to have worked. Over the weekend an “agribusiness flash mob” of sorts met in Tokyo to again voice dissent with Japan having anything to do with the TPP and calling on the government to scrap any plans to enter into the agreement. Amidst the usual showing of JCP and SPJ delegates (anything that hints of US influence immediately sparks voices of protest from these, the most useless of opposition parties), the appearance of Ishiba Shigeru (LDP) raised an eyebrow or two.  From his comments (J), Ishiba apparently does believe that agricultural reform is necessary, but joining the TPP is not the best way to go about it, and that the TPP should not be some sort of litmus test for the LDP in its commitment to reform. 

That may be so, but since the LDP doesn’t have any other plans for revitalise the agricultural sector other than to throw money at it and hope for the best, Japan doesn’t really have a choice. It’s a case of biting the bullet and accepting the removal of tariffs, or keeping tariffs in place, paying out huge sums in subsidies to a dying industry, and ultimately placing Japan at a trade disadvantage. If Abe does make the break with tradition and push Japan into negotiations, he could (as William Pesek has suggested) then follow this up by creating a more effective regulator for businesses (the Olympus scandal was only one example of a more prevalent problem),  end the collusion between government and business (good luck with that), and open the domestic market up to foreign competition – in other words, truly transform Japan’s business environment. If he baulks at this, and merely satisfies himself with massive levels of public spending, then this will be LDP politics up to its old tricks and unlikely to inspire confidence in Japan’s fiscal future.

To use a somewhat unusual metaphor, the current course of Abenomics is like flying a jet with one engine on fire only to increase speed so that you land before the engine explodes. Pretty risky, and potentially fatal. Japan’s entry into the TPP might help to mitigate some of this risk, giving Japanese businesses greater market penetration across the Asia-Pacific, but the real problem lies at home. Let’s hope Abe is a capable pilot. 



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    This is a blog maintained by Greg Pampling in order to complement his webpage, Pre-Modern Japanese Resources.  All posts are attributable to Mr Pampling alone, and reflect his personal opinion on various aspects of Japanese history and politics (among other things).

    弊ブログをご覧になって頂きまして誠に有難うございます。グレッグ・パンプリングと申します。このブログに記載されている記事は全て我の個人的な意見であり、日本の歴史、又は政治状態、色々な話題について触れています。

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