Farmers push to add Japan in trade talks as US automakers balk

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Japanese farmers protest against the Trans-Pacific Partnership in Tokyo. Their banner reads: "We absolutely oppose Japan's participation to TPP."

Farmers in the US are pushing for Japan to join a Pacific trade deal as a way to gain access to the world's third-largest economy as automakers seek to exclude the Asian nation until it opens its markets.

"We're just giddy about the potential here," Nick Giordano, vice president and counsel for international affairs at the National Pork Producers Council, said yesterday of Japan's inclusion in the 11-nation Trans-Pacific Partnership. "TPP with Japan becomes the single most important trade negotiation ever for the United States."

Agricultural groups representing producers and suppliers of pork, rice, wheat, corn, potatoes and dairy products met yesterday in Washington to support the regional agreement as a means to lower tariffs and overhaul regulatory barriers that they say limit US farm exports to Japan.

By adding Japan, the US would gain an accord with its fourth-largest trading partner and the biggest economy in Asia after China. The TPP would embrace about $26 trillion in goods and services a year. The 27 nation-European Union generates about $18 trillion a year.

The US and Japan on April 12 announced an agreement on several longstanding trade issues, paving the way for Japan to join the TPP discussions, which US officials have said they want to complete by the end of the year. The governments now in talks must still formally invite Japan. Australia, Brunei, Canada, Chile, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam are also engaged in the discussions.

Too closed

US automakers, in contrast, want to hit the pause button on the negotiations with Japan.

The American Automotive Policy Council, a Washington-based industry group representing Ford Motor Co., General Motors Co. and Chrysler Group LLC, has said Japan's auto sales market remains too closed to foreign competitors for it to be included in the regional trade pact.

US farm groups say the accord will open Japan to their products, such as rice, which has been limited. Japan produced about 7.7 million metric tons of rice last year, according to the US Department of Agriculture, a bit more than the US total of 5.9 million. China produces 140.73 million tons, the USDA said.

"We've long understood that rice is uniquely sensitive in Japan," said Bob Cummings, chief operating officer of the Arlington, Virginia-based USA Rice Federation. "We're hopeful that at the end of the negotiation we are going to end up with a significant improvement in the quality and the quantity of our rice access in Japan."

On the table

Japanese Prime Minister Shinzo Abe has said all goods in his nation, including agriculture, will be subject to negotiation should Japan join the TPP, acting US Trade Representative Demetrios Marantis told reporters on a conference call announcing the agreement on Japan's role.

Japan's inclusion in the talks also is backed by groups including the National Milk Producers Federation, US Dairy Export Council, National Potato Council and Cargill Inc. of Minneapolis.

"As one of the world's largest economies, Japan's entry into the TPP presents a unique opportunity to re-shape the region's economic architecture and for the future of trade in the Asia-Pacific region so that it works for all citizens in all economies," said Devry Boughner Vorwerk, Cargill's director of international business relations.

Giordano of the pork council said he expected tariffs on most products to be eliminated when the TPP is fully implemented.

While the agreement announced by the US and Japan last week included measures to open trade in goods such as autos and services such as insurance, it had few details on measures for agriculture, a frequent source of tension in US-Japan trade.

The US Trade Representative's office last month cited Japan's policies restricting goods such as rice, wheat, pork, citrus and dairy products as barriers between the two nations. While Japan agreed to open its markets to more American beef as of Feb. 1, it also maintains an import tariff of 38.5 percent for the imports, the US agency said in an annual report.

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