ASSESSMENTS

Japan Has Carefully Paved the Way for Trade Talks With the U.S.

Nov 29, 2018 | 00:19 GMT

A car transport ship sits at anchor at the Nissan Motor's Oppama plant in Yokosuka, Japan, on Nov. 26, 2018.

A car transport ship sits at anchor at the Nissan Motor's Oppama plant in Yokosuka, Japan, on Nov. 26. Automotive exports to the United States remain crucial to the Japanese economy.

(KAZUHIRO NOGI/AFP/Getty Images)

Highlights

In its trade talks with the United States, Japan's main priority will be to maintain access to the U.S. market for its automotive exports. In exchange, it can offer numerous concessions on automotive non-tariff barriers and on trade in the Japanese agricultural market.
On agriculture, Japan's recent trade deals have already opened up political room to ease protectionist measures. However, if the United States pushes beyond those limits, the Japanese government risks a political backlash from farmers.
Japan will push back against U.S. attempts to impose limits on future deals with China, although such a proposal would not entirely derail talks.

Japan will need to make some tough decisions on trade in 2019. This past year has been one of successes for Tokyo with the completion of its long-hoped-for Comprehensive and Progressive Trans-Pacific Partnership (CPTPP) agreement and the signing of an economic partnership with the European Union. Both will take effect in 2019. But just as these kick in, Japan will enter potentially contentious bilateral talks with the United States, Japan's largest export market and its second-largest trading partner overall....

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