Obama, Abe Press Forward on TPP, Analysts See Trade Opportunity After Japan Election
President Barack Obama and Japanese Prime Minister Shinzo Abe discussed aims to complete Trans-Pacific Partnership negotiations in 2015 during a Dec. 16 congratulatory call to the premier on his reelection in Japan, the White House said in a statement (here). Many observers consider Abe's election as a stamp of approval for his economic agenda and important to ongoing trade negotiations.
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Abe called for early elections in November, and some U.S. analysts are saying the political environment in Japan now marks an opportunity for the premier to forge ahead with TPP and other economic liberalization. “Shinzo Abe right now is in as invulnerable a position as you can be as a Japanese premier,” said Michael Auslin, a Japan political expert at the American Enterprise Institute, during a Dec. 16 online discussion (here). “By even calling this election, he comes across as a can-do politician by setting the pact of events.”
The path forward is not guaranteed, however, in light of an enduring U.S.-Japanese impasse on agricultural negotiations in TPP, indicated international economics expert at AEI Derek Scissors. The Republican-led U.S. Congress may move on Trade Promotion Authority (TPA) as quickly as February after the new Congress convenes, in which case time will be limited for Japan to respond constructively, said Scissors.
Many trade supporters and lawmakers view TPA as critical to closing a TPP pact. “Right now, it looks like [Congress is] eager,” said Scissors. “But the rubber has to hit the road. We’ll see the proof of that in January and February. If we do see proof on the American side that the U.S. is ready to step up, then Japan has to respond. And if we get hemming and hawing from Japan, there’s going to be a lot of problems in the U.S.-Japan trade relationship.”
The TPP pact is fundamental to the Japanese drive to reinvigorate its domestic economy and strengthen its foreign policy position, said Scissors. If the Japanese continue to resist TPP concessions, the U.S. must move forward with the other 10 TPP partners, however, Scissors added.