US economy

Japan, U.S. Will Accelerate Talks Toward Trade Deal, Motegi Says

© Reuters. Japan, U.S. Will Accelerate Talks Toward Trade Deal, Motegi Says

(Bloomberg) — After a long wait for the first round of trade talks between the U.S. and Japan, discussions will now take place at an accelerated pace to reach a deal quickly, according to Japan’s chief negotiator.

The first talks focused on agriculture and cars, with digital trade set to be discussed at a later date, Japan’s economy minister Toshimitsu Motegi told reporters after talks wrapped up with U.S. Trade Representative Robert Lighthizer in Washington D.C. Tuesday. Other issues requiring more time have been put on the back burner and are likely to stay there, he added.

“From the next session onwards we will speed up discussions toward an early agreement, and will discuss digital trade at an appropriate time,” Motegi said.

The USTR published a statement saying the two officials had reaffirmed a shared goal of achieving “substantive results on trade” that follows on from last September’s joint statement by President Donald Trump and Prime Minister Shinzo Abe.

There’s a lot at stake in the talks, particularly for Japan, which is desperate to avoid tariffs or quotas on auto exports to the U.S. that could heavily dent its economy. For the U.S. side cracking open Japan’s agricultural market and reducing its trade deficit are objectives that would appeal to Trump’s support base ahead of an election year in 2020.

As China Trade War Cools, Japan Braces for Its Clash With Trump

The latest trade data for March, released early Wednesday in Japan, showed the monthly U.S. deficit with Japan rising 9.8 percent from a year ago.

Motegi said he would be back in the U.S. next week to meet Lighthizer again, adding that it would be appropriate to meet frequently if the two countries are serious about an early agreement.

“The possibility that there’ll be other areas raised for negotiation is very low,” said Motegi. “The U.S. side said that they don’t expect to include in the negotiations areas that will take a long time. Matters that would require systemic reforms in Japan would take a very long time.”

He reiterated his view that the U.S. wouldn’t apply auto tariffs to Japan while talks were ongoing and that any currency issues don’t fall under his remit.

Farmers’ Ire

U.S. lawmakers, especially those representing agriculture interests, have been pressing the Trump administration to quickly wrap up a deal with Japan to counter any lost market share American farmers have been suffering over the past year as competitors such as Australia benefit from a multilateral deal spurned by the U.S.

In a recent hearing on Capitol Hill, Lighthizer told senators that he’s aware of the precarious situation farmers are in and that winning market access for agriculture products in Japan is a very high priority.

In response to questions from senators who would have preferred the U.S. to stay in the Trans-Pacific Partnership, Trump’s trade chief said a bilateral deal with Japan could make up for farmers’ lost opportunities.

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