Japan has announced today that it will enter into the Tran-Pacific Partnership (TPP) negotiations thus, becoming the 12th country to join.
The TPP already consists of 11 other countries: Australia, Brunei, Canada, Chile, Malaysia, Mexico, New Zealand, Peru, Singapore, United States, and Vietnam.
Japan is the world’s third largest economy. However, its economy has slowed down, which leaves government officials trying to figure out ways to boost its economy. One way to spur economic growth is to join the TPP, at least according to the government and many business people.
Japan’s Prime Minister Shinzo Abe said:
Emerging countries in Asia are shifting to an open economy one after another. If Japan alone remains an inward-looking economy, there would be no chance for growth…This is our last chance. If we miss this opportunity, Japan will be left behind.”
Japan’s participation in the TPP means that it would reduce many of its high tariffs on imports entering the country and provide access to additional markets for Japan’s exporters.
Nevertheless, many farmers in Japan strongly oppose the TPP agreement. They fear that the reduction in tariffs on agricultural goods will result in the decline of Japan’s agriculture sector.
Agriculture has been a source of tension during some of the TPP discussions, even prior to Japan’s entry (see Peterson Institute for International Economics for a detailed study on agriculture and the TPP).
I wonder if agriculture will be as tense in these negotiations as it has been in the Free Trade Area of the Americas (FTAA) talks and the Doha Round of the World Trade Organization (WTO). Disagreements surrounding the liberalization of trade in agriculture actually resulted in the complete failure of the FTAA and in stalling the WTO negotiations since December 2005. Unfortunately, the texts of the agreements from each round of negotiations are not available to know the actual positions that are being put forward. (A summary of each round is available on the USTR’s website though.)
The 16th round of the TPP talks just took place two days ago. The next round is scheduled to take place in Lima, Peru (May 15-24).