US-Japan Trade Negotiations Focus On Agriculture And Automotive

- Apr 24, 2019-

"The economic and trade talks held this time were a continuation of the Japan-US summit talks in September last year." Chen Yang, a young Japanese scholar, said in an interview with the China Trade News that Japanese Prime Minister Shinzo Abe and the US President Trump launched the name. Agreeing on the new trade negotiations for the Goods Trade Agreement (TAG), the two sides pledged to cut tariffs on agricultural products and industrial products. In addition to negotiating tariffs on agricultural products and industrial products, the representatives of Japan and the United States also talked about exchange rates.


Chen Yang said that the Japan-US economic and trade negotiations are both a frontier and a post-opening. Shinzo Abe will visit the United States at the end of April to hold a summit meeting with Trump. As a result, this economic and trade negotiation is important because if there is no progress that is satisfactory to the US, then he will exert pressure when he meets with Abe, thus diluting other issues that Abe wants to communicate in depth.


"Trump, who is committed to re-election, will seek to achieve economic and trade achievements as soon as possible, forcing Japan to compromise as soon as possible, but the Japanese side will certainly continue to delay." Chen Yang said that Trump is very dissatisfied with Japan's economic and trade deficit, After making certain progress in Sino-US economic and trade negotiations, Japan will be regarded as the next key target.


Contrary to this, with the improvement and development of Sino-Japanese relations, China-Japan economic and trade cooperation will be deeper in the future. "On the one hand, Japan faces the economic and trade pressure of the United States, and it is inevitable that the economy will turn closer to China. On the other hand, 'Abenomics' has a declining trend. This year is another crucial year for the Japanese economy. Therefore, the Abe government must withstand the pressure of US economic and trade. Deepening economic cooperation with China." Chen Yang said that it is worth noting that before the Japan-US economic and trade negotiations, the fifth China-Japan high-level economic dialogue was held in Beijing on April 14th. The two sides deepened economic cooperation and maintained Ten consensuses have been reached on multilateralism and the free trade system.


It is understood that the Japanese-American trade war began in the 1960s. From then until the 1990s, the two sides had numerous trade disputes, including six large-scale trade wars at the industry level and two trade wars at the macro level. The focus of the US-Japan trade negotiations is on agricultural products and automobiles. What Japan seeks is the signing of an article trade agreement limited to the trading of goods such as automobiles and agricultural products, and the United States envisages the achievement of a comprehensive free trade agreement including trade in services.


According to foreign media reports, with the withdrawal of the United States, the Comprehensive and Progressive Trans-Pacific Partnership Agreement (CPTPP) has entered into force, and the current US beef market share in Japan is being taken away by competitors. In addition, Japan is cautious about the United States to promote the further opening of its domestic agricultural market, and has said that it will not make greater concessions than the existing bilateral and multilateral free trade agreements.


"During this negotiation, the US hopes that Japan will further reduce the tariff on imported US agricultural products, at least to the level of the Trans-Pacific Partnership Agreement (TPP)." Chen Yang told reporters.


However, a senior Japanese official told the media that Japan has no way to reach an agricultural agreement. If the United States urges Japan to open its agricultural market as soon as possible, the Japanese government may propose that the United States cancel the tariff on Japanese industrial products.


"Because agriculture has always been the "sacred domain" of Japan, the automobile industry is the pillar industry of Japan's economy. Therefore, the Abe government will make concessions in reducing US agricultural products and further opening up the domestic automobile market in Japan, but the pace will not be too great." Chen Yang believes.


In the automotive field, relevant experts said that the views of Japan and the United States are difficult to agree. Last year, in the US-Mexico-Canada agreement between the United States, Canada and Mexico, major components such as cars, engines and gearboxes that were produced locally were required to be produced within the three countries, even if only one was used outside the region. The product, this model can not be identified as a production vehicle in the region, can not enjoy the zero-tariff import and export treatment between the three countries, this new agreement is expected to take effect in 2020, this agreement will bring more to Japanese automakers A big shock may lower the competitiveness of Japanese cars in the US and North American markets.


"But because of the Japan-US economic and trade deficit, Japan's exports to the United States account for 80% of the total deficit, so the United States requires Japan to further open the domestic auto market." Chen Yang said.


In addition, on the exchange rate issue, the United States advocates the establishment of a restriction to induce the yen exchange rate to fall. In this regard, Chen Yang believes that it is precisely because the depreciation of the yen in recent years has brought the Japanese economy back to development, so the Abe regime will be cautious on the exchange rate issue. In view of the fact that Japan and the United States still have considerable differences on economic and trade issues, economic and trade negotiations between the two countries will continue.

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