U.S., Japan look to trade to boost both economies
WASHINGTON – For the last two decades, Japan’s stagnant economy has taken a back seat to China’s explosive growth. But the economic agenda for the U.S. and Japan is heating up, presenting new opportunities for the U.S. and trade frictions reminiscent of the 1980s.
In White House discussions Friday, President Barack Obama and Japanese Prime Minister Shinzo Abe took up a range of security concerns, pledging solidarity in responding strongly to nuclear provocations from North Korea. Abe also assured Obama that Japan would “act calmly” in its standoff with China over islands in the East China Sea.
But their minds were largely focused on one thing: getting their economies growing more rapidly.
Obama would like to see Japan join the U.S., Canada, Mexico, Australia and seven other countries in negotiations for an Asia-Pacific free-trade agreement. The administration sees the pact as an important part of its “pivot to Asia.”
But the American auto sector and Japanese farmers, important constituents for Obama and Abe, have balked at Japan entering negotiations that could expose their industries to greater foreign competition.
On Friday, the U.S. and Japan issued a carefully worded statement suggesting that although all goods would be on the table in the trade talks should Japan join, there could still be a deal in which each side protected its most sensitive sectors.
For Abe, who took office in December for a second time as prime minister, his meetings in Washington were aimed at promoting his own economic program. The Japanese have dubbed his plan “Abenomics” – an effort to break out of a devastating deflationary period with fiscal and monetary stimulus and other efforts.
“I am back, and so shall Japan be,” Abe said Friday afternoon in remarks at the Center for Strategic and International Studies, a Washington think tank.