CPTPP: Japan’s long overdue shot at leadership

Nalifa Mehelin | Published: November 09, 2018 21:21:39


Amidst the success of the Paris Agreement in committing towards a sustainable environment and the breakthrough in handling the refugee crisis in Europe, the year 2015 gained momentum when 12 countries of the world agreed to create a Trans-Pacific Partnership (TPP) to foster free trade across the region. Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, United States and Vietnam brought a promising deal on the table for economies to grow and growth to persist.

Like every other 'Too good to be true' event, following the 2016 elections, the aftermath of it not only shattered the lives of millions of Americans, it also cast a shadow of doubt over the trade agreement. However, despite the US backing out, the remaining 11 countries agreed to pursue the deal under Japan's leadership. Through 'Comprehensive and Progressive Agreement for Trans-Pacific Partnership', or TPP-11 as it is called, the world witnessed Japan, a nation usually preferring to remain behind the scenes, leading the trade bloc. What prompted this reformation of a country like Japan, which has been shielding itself from the spotlight, is increasingly intricate given the stakeholders involved in the scenario.

A common supposition lies within China's gradual emergence as an economic superpower. The growing influence of Beijing might have stimulated Tokyo to come out of its shell. Japan's leadership in TPP-11 is not beyond that influence. When asked about Japan's emergence as a leader for TPP-11, R Taggart Murphy, an avid specialist in Japanese society and culture and the author of the book "Japan and the Shackles of the Past", emphasises the impact China has over Japan. According to Murphy, arguably with TPP-11, Japan is supposedly trying to avoid China's orbit. However, Yoichi Funabashi, the chairman of the Asia Pacific Initiative and a renowned journalist specialising in Japanese Foreign Policy, expresses a slightly different opinion in this regard. Linking it with the significance of the U.S. in the Pacific region, in a Washington Post article, Funabashi writes, "Deeper U.S. engagement in Asia is indispensable to balance China." Moreover, while delineating Japan's response to China's security dominion, the 2016 annual report of the 'US-China Economic and Security Review Commission' stated, "Japan is balancing against China by boosting its own capabilities and reaffirming its alliance with the United States". All these assertions indicate the possibility that, against the background of US-China trade war, TPP-11 is Japan's tactic of staying out of the way given its allegiance with Washington and the murky past with Beijing.

In the absence of the US, another collective presumption to pursue this deal was the wide scope of exercising its leadership power within the Pacific. To foster trade and economic growth, Asian economies and the world in general depended on American dominance and influence. Securing the flow of trade without the US in Asia would have been a challenge for a single country. A trade bloc, however, makes it comparatively easier. Moreover, being the leader of the trade bloc gives Japan the comparative advantage of arguably being the regional hegemon in this scenario. Specifically, with China's influence over the Regional Comprehensive Economic Partnership (RCEP) with the ASEAN countries, it was crucial for Japan to negotiate this deal to set itself up in a relatively secure position trade-wise. TPP-11 creates that atmosphere for Japan.

Aside from the China-Japan dynamics, according to many experts, Japan is also trying to fill the regional vacuum in trade leadership created by the US, further emerging as a dominant trade leader. While Japan has its own benefit in signing the deal, one question still remains -- had the deal jeopardised US-Japan trade relations, would Japan have taken the lead nonetheless? The likely answer to this question is in the negative, according to experts. Though TPP-11 is a trade agreement, the underlying impacts of Japan's role lean towards the strategic relation it has with China. As described earlier, with China's increasing dominance in the region, Japan cannot and most likely will not offend the US in any way to sustain control over the region.

Japan underwent significant domestic pressure while lobbying for the TPP-11. During Prime Minister Yoshihiko Noda's tenure, strong domestic pressure from the agricultural sector persisted against Japan's participation in the TPP-11. Japan has a rigid protectionist policy approach towards its agricultural sector, protecting the farmers by heavily taxing consumers of imported goods. The trade negotiation requires Japan to agree to a reduced tariff policy for imported goods, which in turn poses a serious threat to domestic farmers. In one of his articles for the East Asia Forum, scholar Sebastian Maslow argues that, "In promoting a zero-tariff policy across all industrial sectors, the TPP is a challenge to Japanese farmers who have long sought protection from global free trade and competition behind a massive wall of tariffs and other barriers to trade." Additionally, an associate professor at Bryant University, Nicole Freiner wrote about the potential threat that the agreement seems to be posing to the domestic agricultural industry. Arguing that the TPP-11 will probably grant leverage to large corporations in terms of weakening the current laws against Genetically Modified Organisms, Dr. Freiner said, "The TPP SPS agreement potentially puts health standards below trade liberalisation, making them subordinate to concerns related to trade." While TPP-11 is yet to start its implementation phase, these objections made Japan even more cautious about setting a high quality deal ensuring the interests of the concerned groups.

TPP-11 was perceived as a 'dead deal' when the U.S backed out. The leadership and persistence of Abe administration to keep the deal successful once again point to the authenticity of Japanese polity and culture. This unique trait is portrayed eloquently in 'Inventing Japan' written by historian Ian Buruma, "But one quality has stood out to serve Japan better than any other: the grace to make the best of defeat." Among many other examples, TPP-11 will go down in history as another luminous one. Ganbatte!

Nalifa Mehelin graduated with a Bachelor of Arts in Economics from the Asian University for Women in Chittagong, Bangladesh. She was a Summer Research Fellow in Temple University, Japan Campus. Her research topic was 'Japan's leadership in TPP-11'.

nalifamehelin@gmail.com

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