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Japan's Abe to announce join trade pact talks

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(Globalpost/GlobalPost)

Japan will announce its participation in talks to forge a US-backed free trade deal Friday, an official said, giving the pact much-needed economic clout, but possibly angering farmers at home.

Supporters of the Trans-Pacific Partnership (TPP) say it would give Japan's flagging economy a boost and increase consumer choice.

But opponents claim it could be a body blow to the country's ageing farmers, possibly removing the sky-high tariffs that have sheltered them and sending many to the wall, changing the face of the countryside in the process.

Participation by the world's third largest economy would give a shot in the arm to a pact seen as a key part of US President Barack Obama's pivot to Asia, and a counterbalance to China's rising regional clout.

If the talks reach a deal, the 12-nation free-trade zone including Japan would account for 40 percent of global gross domestic product, according to the foreign ministry in Tokyo.

"I will hold a news conference at 6:00 pm (0900 GMT) and announce joining the talks" on the TPP, Prime Minister Shinzo Abe told senior officials of his Liberal Democratic Party (LDP), according to a party official.

Joining the TPP would boost Japan's gross domestic product by 0.66 percent, or 3.2 trillion yen ($33 billion), according to government estimates that will be announced Friday, local reports said.

But the move is likely to stir anger in Japan's rural heartland -- a key source of support for Abe's brand of conservative nationalism -- where farmers enjoy almost unparalleled protection, with rice attracting import tariffs approaching 800 percent.

In a bid to head off these objections, Abe's administration has furiously spun a joint statement issued in Washington after summit talks with Obama.

The statement said the two countries recognise "bilateral trade sensitivities, such as certain agricultural products for Japan and certain manufactured products for the United States".

Tokyo has been keen to give the impression that this could mean products such as rice are off the table, especially ahead of upper house elections in July, which Abe must win if he wants a free hand to press his legislative programme.

The Washington statement was praised for treading a fine line, allowing both sides room to be able to claim it as a low-key victory.

"As the final outcome will be determined during the negotiations, it is not required to make a prior commitment to unilaterally eliminate all tariffs upon joining the TPP negotiations," said the statement.

Tokyo and Washington will "continue their bilateral consultations with respect to Japan's possible interest in joining the TPP", including work on "addressing outstanding concerns with respect to the automotive and insurance sectors", it said.

Late Thursday, the LDP's task force on the TPP asked Abe to ensure exemptions on sensitive items -- rice, wheat, beef, dairy products and others -- adding they want Japan to withdraw from talks if these are endangered.

But the task force also said "if Japan doesn't participate in negotiations, it will not be able to take advantage of growth in the Asia-Pacific region".

"We call for a great decision based on a far-sighted state policy," it said in a statement submitted to Abe.

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http://www.globalpost.com/dispatch/news/afp/130315/japans-abe-announce-join-trade-pact-talks