Abe’s TPP hopes may not come true

By Chen Yang Source:Global Times Published: 2017/7/18 20:58:39

Illustration: Liu Rui/GT



The chief negotiators from the 11 Trans-Pacific Partnership (TPP) countries met from July 12 to 14 in Kanagawa Prefecture, Japan, to discuss possible options for the trade deal's early entry into force now that the US has withdrawn from the deal. They also discussed whether the deal needs to be altered. Among the 11 members, Japan and New Zealand want the TPP to come into effect as soon as possible while Vietnam and Canada are cautious about it. In this sense, there is only a slim possibility that the pact can be implemented this year despite Japan's efforts.

Japan intends to use its broad accord with the EU on the Economic Partnership Agreement (EPA) reached in early July to achieve the early implementation of the TPP. This endeavor helps hedge against the rising trend of protectionism around the world, but the two free trade pacts are a double-edged sword for Japan. While Japan can economically benefit from the implementation of the EPA and TPP, its agricultural industry may have to suffer a huge shakeup caused by the entry of agricultural products from Europe, Australia and New Zealand at low or even zero tariffs. This will eventually shake the stability of the administration of Japanese Prime Minister Shinzo Abe since he is predominantly supported by rural farmers.

The Abe administration has relentlessly tried to promote the implementation of the TPP after the US withdrew in early 2017 for two reasons. First, Japan seeks to offset trade pressure exerted by the Donald Trump administration with multilateral trade pacts. When meeting with Abe on the sidelines of the G20 summit earlier this month, Trump called for Japan to knock down tariff barriers and open up its market. Japan has limited say in economic and trade negotiations with the US despite being one of the most loyal allies of the US in the Asia-Pacific region.

Abe also intends to bolster his Abenomics with the early entry into force of the TPP. Despite his diplomatic achievements since he retook office at the end of 2012, the economy has performed poorly and Abenomics has been widely questioned. The GDP of the 11 TPP countries accounts for 15 percent of the world's total. Its early implementation can help drive Japan's economic growth and therefore cover up the defects of Abenomics.

Abe also wants to confront China by using the TPP. China's rapidly developing economy in recent years has significantly dwarfed Japan - once an economic power in Asia - and the EPA will not help in elevating Japan's clout in Asia. Abe relentlessly promotes the TPP to avoid Japan being outshined by a rising China and to safeguard its position as an economic power in Asia.

Geopolitically, if the TPP can be implemented in addition to the broad accord of the EPA, Japan will be able to strategically contain China, particularly China's Belt and Road initiative, by diminishing its influence and development space.

However, Japan's expectation for the TPP won't necessarily become reality. US participation in the pact is crucial to the TPP's development. After the US pulled out of the pact, Japan, the largest economy among the TPP members, can hardly work as a leader. After all, Japan is unable to be in the same category as the US and China in terms of domestic market size and international clout. Japan has limited space to play a leadership role and hence is unable to put the TPP into effect on its own.

The author is a PhD candidate with the Tokyo-based Toyo University. opinion@globaltimes.com.cn



Posted in: ASIAN REVIEW

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