Japan Bids To Join Pacific Trade Area

by Mary Swire, Tax-News.com, Hong Kong

10 November 2010

Japan's Prime Minister Naoto Kan has indicated that Japan is willing to participate in talks on joining a free trade pact with the Trans-Pacific Partnership (TPP) as discussions begin in Yokohama at the 21-member Asia-Pacific Economic Cooperation (APEC) forum.

An even wider Free Trade Area of the Asia-Pacific (FTAAP) could eventually comprise the big three, the United States, China and Japan together with fast growing emerging countries Indonesia, Thailand and Mexico.

Japan's policy on such an economic partnership was approved at a cabinet meeting immediately preceding the APEC talks. Chief Cabinet Secretary Yoshito Sengoku told reporters after the meeting that Japan would make a formal decsion on whether to seek to join TPP next year after examining the implications for the agricultural sector, which it is thougtht, would be materially affected.

Kan has set up a committee of four cabinet ministers, headed by National Policy Minister Koichiro Genba, to examine the full implications for Japan's agricultural support policies. The TPP envisages removing all tariffs in 10 years without exception, whereas Japan has usually negotiated special concessions for agriculture.

Hiromasa Yonekura, chairman of the Japan Business Federation, Nippon Keidanren, has made it clear to the government on behalf of Japanese commercial interests that the country needs to open up and promote economic integration in the Asian Pacific region.

The Trans-Pacific Partnership is a multilateral free trade agreement originally signed in 2005 between Brunei, Chile, New Zealand and Singapore. Negotiations began last March for the inclusion of the United States, Australia, Peru, Vietnam, and Malaysia. Canada, Thailand and South Korea have indicated interest, but as yet taken no formal action to join.

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