US bilateral talks with Japan tied with success of Trans Pacific Partnership

Trade rep Froman notes imported vehicles a tiny fraction of the Japanese market, compared to nearly half the US market.

TOKYO — US Trade Representative Michael Froman is urging Japan to get serious about negotiating over letting more American cars and insurance companies into its market.

Froman said the ongoing bilateral talks with Japan dealing with such historical sticking points are tied with the success of the larger and parallel trans-Pacific free trade negotiations.

Japan joined the Trans-Pacific Partnership negotiations involving 12 countries on July 23, aimed at achieving regional free trade.

Froman acknowledged every nation had “sensitivities,” but stressed TPP talks were tied with the success of the bilateral dialogue, which deal with non-tariff problems such as autos and insurance.

Froman, in Asia for TPP talks and meetings with his Southeast Asian counterparts, said the historical issues highlight a sense of unfairness that “Japan’s success came at the expense of others.”

He noted that imported vehicles make up a tiny fraction of the Japanese market, although nearly half the US auto market was controlled by foreign manufacturers.

He said the feelings of unfairness reached their height in the late 1980s and early 1990s, but he stressed the obstacles still remain, and are linked to the success of the overall TPP talks.

The US also believes that Japanese government-backed insurance services run by the post office have an advantage over private and foreign companies.

Japanese Prime Minister Shinzo Abe, who took office late last year, is a proponent of the Pacific trade pact, despite running the risk of domestic criticism, such as from farmers who fear cheap imports will drive them out of business.

Froman said the US was hoping for a comprehensive TPP agreement later this year.
When asked about Japanese media reports that said Tokyo may be willing to do away with 85 per cent of its tariffs, Froman called it “a good initial step.” The goal was the elimination of all tariffs, he said.