Sunday May 27, 2012

Obama praises Noda's 'boldness' for taking risk over TPP talks

Politics ( 30 )

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President Barack Obama meets with Japanese Prime Minister Yoshihiko Noda at the APEC Summit in Honolulu on Saturday. AFP

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  • 5

    Yubaru

    Now Noda needs to make something akin to a state of the union, or state of Japan speech to the entire nation here and outline his vision for Japan and what or how he views Japan's participation in TPP will improve the economic situation.

    Take the bull by the horns so to speak and shut the opposition up and get the people behind him.

  • 1

    Darrin Flores

    Obama is worried about China... and all the cheap goods that have destoyed American jobs.... Americans are hooked on cheap goods.... and has driven the manufacturing and other services to poorer countries and cheap labor ... like Mexico and Canada and India..... Japan better be careful with Obama !!

  • 0

    JapanGal

    Agreed Yubaru. You hit that nail.

  • 0

    CrazyJoe

    Noda also told Obama that Japan is in the process of easing US beef import restrictions. He's got a lot of explaining to do to the Japanese public.

  • 0

    hatsoff

    and solidifies the U.S. role in setting the rules in fast-growing Asia

    Mmm....I'm wondering if it might not be in Japan's best interests to pursue bespoke Free Trade Agreements on a country-to-country basis.

  • -1

    Yubaru

    Mmm....I'm wondering if it might not be in Japan's best interests to pursue bespoke Free Trade Agreements on a country-to-country basis.

    How would that be better than the potential for a trading block that is even larger than the EU? Consider this, potentially the entire Pacific rim as a free trade zone, it's mind boggling really.

  • -4

    Sherman

    Cheaper rice on the horizon......

  • 3

    hatsoff

    @ Yubaru, I'm late to the TPP issue so I have no concrete opinions on it right now, but I'm wondering about the US role here. Naturally, they want to increase their exports and this would be a good opportunity to do so. Fair enough for the US. It's also natural for some of the posters here to take a US slant on things because of their nationality. That's fair enough.

    I'm just wondering if the changes this will bring about in Japan will be as beneficial for Japan as they would be for the US. More washing machines sold in South Korea, sure. More Toyotas sold in the US? But they're already built and sold in the US. And what about the effect on health services - if free market profit-at-all-costs principles are applied to healthcare provisions and hospital services?

    And then I'm wondering why China, the world's second largest economy, is not enthusiastic about the TPP. The entire Pac rim as free trade zone? Sounds intriguing, but who really benefits? As natural as it is for the US to pursue its own best interests, so too is it natural for Japan and the other Asian countries.The following stat/quote comes from the other JT today:

    While trade is important, it accounts for only about 15 percent of Japan's economy. The government should realize that increasing domestic demand is the authentic way to strengthen the economy. It should especially take steps to improve local economies.

    Not slamming your view. As I said, I'm late to the issue and just getting a handle on things.

  • 0

    tmarie

    and has driven the manufacturing and other services to poorer countries and cheap labor ... like Mexico and Canada and India

    Canada? You put Canada in as cheaper labour with Mexico and India? Oh lord! Someone needs to be aware of many Canadian jobs went - to Mexico due to NAFTA! Get your facts straight please!

  • 2

    Yubaru

    hatsoff fair enough, thanks for replying too!

    Ok first,

    And then I'm wondering why China, the world's second largest economy, is not enthusiastic about the TPP.

    In my under-educated opinion here, China is not enthusiastic about TPP because then they as well would be held to international or trade agreement standards. Meaning they would have to play ball in regards to regulating their industries to follow the agreements made in the TPP. China has a notoriously bad reputation of wanting to do things their way and in effect say screw you to the world.

    The benefits to the overall Japanese economy would far outweigh any negatives from the standpoint that exporters would have new markets open up, well maybe not totally new markets, but markets free from tariffs that make their products overly expensive and vice-versa as well.

    Products here in Japan that are produced domestically cost the consumer more than what they would pay in a foreign market. Much of that is due to the current Japanese supply system which has too many middle men taking their cut of the products.

    With little or no import tariffs internationally produced products would find a huge market here and would force domestic companies to streamline their production methods to compete. The consumer here would be in a win-win situation. Also the domestic consumer here holds trillions of dollars of Japanese debt, unlike other foreign countries like the EU or Greece, and if the domestic consumer here starts using the money they have stashed away to start purchasing more goods and services, whether they be domestic or foreign, it would help to improve the overall economy as well.

  • -2

    Joseph Garrett Baxter

    For the most part Japan is an import driven country except for electronics and automobiles area but many of these things are now made overseas. Japan can not rely on themselves which makes Japan a weak country unlike India which can survive on their own if needed. Much of the food is too expensive in Japan and this needs to change. The Japanese consumer will win on this deal, but farmers will lose. Japanese made electronic products are generally superior to all other countries and they will gain on that front with increased sales into the USA. Japan is still a closed country and it should do everything it can to open up. There are very few resources in Japan so it does not take an idiot much to understand why Japan needs this deal.

  • 0

    Yubaru

    For the most part Japan is an import driven country except for electronics and automobiles area but many of these things are now made overseas.

    If this is the case then could you explain why the US, has a roughly speaking here $5 billion dollar per month trade deficit with Japan? Which comes out to nearly $60 BILLION dollars per year?

  • -1

    Dotobock

    As highly skeptical to TPP, I'm irritated over the undemocratic nature of this process. The TPP was not mentioned in the DPJ manifest nor did Noda talk about the TPP up until quite recent and then all of a sudden he proclaims that Japan will start to negotiate in order to join when the majority of people in Japan are against this agreement. Reminds me of some European countries who became EU members without the majority public support thus making it undemocratic. In such important issues, I'm all in favor of referendums. If you compare to Europe, the Nordic countries and Switzerland all had referendums about EU. Two highly successful countries with strong economies chose not to join EU. Norway and Switzerland. And without being an EU member has not hurt them one but. I found the speed of the decision making of joining TPP to be outrageous and undemocratic. The public had not yet been informed, far from it. There are so many issues which needs to be addressed and the public has not. Then one also could ask, if this was the right time to talk about TPP when we are currently in one of the worst crisis in Japanese history after the devastating quake. Most of the messages I read is from selfish foreigners simply wanting cheaper rice and food without them having any kind of awareness what this could do to local communities in rural Japan.

  • 3

    hatsoff

    Yubaru, thanks. That's food for thought.

    Just thinking aloud to myself now, I don't think the TPP will solve the problem of subsidies and the so-called 'agricultural dumping' that tends to go with it. I once saw a very interesting documentary called King Corn. One thing that stuck in my mind was how much the maize industry is subsidized in the US. Basically, growing corn doesn't make the profit for the farmers - the subsidies from the US government does. And the corn is then used for cattle feed, corn syrup and ethanol. If the US could find new markets for all that corn, it would be good for the US finances but maybe not so good for the recipients.

    Another study (Watkins and Von Braun, 2002) used cotton as an example of the effect of subsidies: US subsidies to its 25,000 farmers was US$3.4 billion, giving the US a 40% share of world export markets. The subsidies lowered prices by 25%, which cost West Africa's cotton farmers around $190 million in 2001. Not specifically regarding cotton, but I'm not sure this bodes well for smaller TPP countries, like Vietnam, Chile and Peru. The concern here is, how well will developing countries develop if they keep getting undercut by the surpluses of developed countries? This isn't anti-USA; the same can be said of some of Japan's products. Hence my earlier post about pursuing bespoke FTAs on a country-to-country basis.

    Now I know Japan subsidizes its rice farmers hugely, but Japan is unlikely to be making big inroads into foreign markets with its rice, which is basically sold to the domestic market - it just doesn't have enough land to make it a big export item. And Japan already relies on 50% imports for other crops and meat requirements.

    I have read lots of posts here on JT lambasting Japan's farmers - and on one hand I can see the rationale behind that. But on the other hand, I remember Britain in the 1980s, when Thatcher closed down the coal mines, which decimated mining communities - what will happen to the rural communities here in Japan when they are undercut by the subsidized imports of the US? These are real people, and real families and communities. The imported foods will only require distribution, so not only will the growers be affected, but the food processors too, and the knock-on effect (like in the UK) will pull real estate agents and shops under too. Before they built Fukushima Dai-ichi in the 1970s, locals had to seek work in winter outside the prefecture. Is this really what we want to return to?

    Sorry for the ramble everyone. As I said, just thinking aloud. I'd be the first to hold my hands up and say I'm not an economist.

  • 0

    Dotobock

    Basically, growing corn doesn't make the profit for the farmers - the subsidies from the US government does. And the corn is then used for cattle feed, corn syrup and ethanol. If the US could find new markets for all that corn, it would be good for the US finances but maybe not so good for the recipients.

    Add to the fact that this corn is GMO and it is used to feed cows which are injected with banned chemical growth hormones, I start to wonder if this is a step on the right direction. I do not think it is healthy for humans and not to mention the global environment. GMO manipulates the natural eco system. It is highly non environment friendly. What pushes companies and countries to push for this is simply money. And that to me is sad. While productivity is low amongst Japanese farmers one should ask if productivity is everything. If all we thought about was productivity we would all be living in a gigantic Mc Donald´s factory. Everything should not be measured in numbers and that is the beauty of small scale famers in rural Japan. It is soul farming.

  • 0

    JacopoMTK

    Obama has promoted the so-called Trans-Pacific Partnership as a new brand of free trade agreement that protects labor and environmental standards and solidifies the U.S. role in setting the rules in fast-growing Asia.

    And..why U.S should setting rules in Asian developed nations as Japan?I mean,this could be an excuse for developing countries that need support,but for Japan this will be only a bad think,the only reason JP should agree with this is to keep the relationships with U.S.And that's the problem...Basically Japan sure don't want to agree with TPP but they're kinda forced to do it...

  • -1

    Dog

    YubaruNov. 13, 2011 - 09:10PM JST How would that be better than the potential for a trading block that is even larger than the EU? Consider this, potentially the entire Pacific rim as a free trade zone, it's mind boggling really.

    With more than half of them trying to cheat their partners out of having the ability to export to them through currency manipulation, regulatory paperwork and local 'custom', and economic nationalism...it's really mind boggling

    The Pacific Rim has got a long way to go before it even gets near the ECSC of the 1950's.

    Outside of the Anglo-Saxon 3 and probably Chile, you're dealing with an economic animal that is pre-Adam Smith in economic enlightenment.

  • 0

    FernandoUchiyama

    My way of seeing it is that Noda is right. Japan must mingle it's economy and society with the rest of the world, thats why I myself approve any actions that would tend to becoming more mixed with others.

    The country has a serious problem, that it's supply chain is very very expensive. Twenty years ago Japan was recognised for its good quality products and technology. Japan sold a lot of cars and electronic devices cause of that.

    Today, quality and techonology are not important anymore, because every company around the globe have it. Thanks for the Internet, that makes possible to share and spread knowledge making it not important.

    Today, what is important is the creativity, the inteligence, the creation of ideas, the innovation, the motivation and determination to increase people`s quality of life.

    Japan built a great country based on hard work, with dedicated citizens laboring twelve hours a day, six days per week. But, what the world is seeking today is not hard work, but good ideas. With good ideas its possible to work less and enjoy life.

    Most of the japanese says that theirs companies must be protected and subsidized by government. My opinion is that its wrong. What Japan needs right now is the vision that there is something wrong in its supply chain.

    If you look at the market of underdeveloped countries, you will see that Japan is not competitive there. Ford, GM, Wolkswagen and other european and american companies are able to produce cheaper cars than its Japanese counterparts. Most of the Japanese will say thats because of yen. But these cars are being produced abroad, not in Japan. And even though, they are more expensive. I guess japanese processes are more bureaucratic, more detailed. It makes the products more expensive and the benefits are not too much higher these days.

    Much earlier Japan mix its economy it will be better. When that happens, the japanese will see the real problems and work to fix that. In some ways, i think Japan needs to do something that it hates very much: to change.

  • -2

    Marion Wm Steele

    JacopoMTK: Don't get in a hurry; Obama is having trouble in the USA - All over California we see "Impeach Obama" signs and I pray that Obama is a one term President - Personally, I hope Newt Gingrich will be our next President.

  • -3

    YongYang

    Cheap food! Safe food! Milk! Open up!

  • 0

    issa1

    As highly skeptical to TPP, I'm irritated over the undemocratic nature of this process. I'm all in favor of referendums. I found the speed of the decision making of joining TPP to be outrageous and undemocratic. The public had not yet been informed, far from it. Most of the messages I read is from selfish foreigners simply wanting cheaper rice and food without them having any kind of awareness what this could do to local communities in rural Japan.

    To - DOTOBOCK I'm completely aligned with their thinking. This is the way to govern dpj.

    1 - lie and deceive - use all means t o reach power

    2 - lie and deceive - dissimulate the facts to conceal the reality and persuade their ideology

    3 - lie and deceive - to perpetuate itself in power.

  • 0

    ubikwit

    these would-be agreements are clouds floated above the heads of the weary eyed sky watchers looking for a sign from the heavens.

    i wouldn't get me 'opes up, matey.

    in fact, if every country simply does away with taxes, it winds up that the government of every country has less money to spend on pubic programs, and thereby indirectly weakens each government.

    who exactly is supposed to benefit? consumers or producers? which are more representative of the public?

  • -2

    herefornow

    I found the speed of the decision making of joining TPP to be outrageous and undemocratic.

    issa1 -- and, honestly, I found your inablity to comprehend simple concepts, or pretending to do so, equally as outrageous or possibly scary. All Japan has done is agree to join the talks. They have NOT made a decision to actually join TPP, because, TPP does not even exist right now, and, it is not 100% assured that the nine originating countries will all even accept Japan joining the talks. Any decision on joining is years away. What is it about that that you cannot comprehend? All Noda has done is try to give Japan a place at the table/a voice, so any TPP agreement would address their concerns and not have to accept an agreement that is already decided. Japan is free to walk away at any time, but at least this gives them the option of participating on terms acceptable to them.

  • 1

    Yubaru

    TPP does not even exist right now,

    You really need to expand your view of the world beyond the USA TPP has existed since 2006 as an agreement between Brunei, Chile, New Zealand, and Singapore.

  • 1

    the_sicilian

    Yubaru

    Products here in Japan that are produced domestically cost the consumer more than what they would pay in a foreign market. Much of that is due to the current Japanese supply system which has too many middle men taking their cut of the products.

    Exactly. This is part of the "protection" that Japanese get in their market, and then the Japanese produced goods are high in price, so the consumer gets screwed. Why should an oil filter for my Japanese car cost in excess of Y 4000 when in my home country the same filter is Y 900 ?

    I'm glad to see Noda is at least considering this, for the greater good of Japan and Asia.

  • 1

    acurasan

    Darren Flores - cheap labor in Canada?

    U.S pays $7.50/hr for minimum wage and Canada between $9.50-11 depending on which province you live. We have one of the best economy and one of the most livable country in the world. You're the guy that installs cheap pipelines valves made in China are you not?

  • 0

    Yubaru

    The Pacific Rim has got a long way to go before it even gets near the ECSC of the 1950's.

    Outside of the Anglo-Saxon 3 and probably Chile, you're dealing with an economic animal that is pre-Adam Smith in economic enlightenment.

    While this may be true everyone has to start somewhere and getting off the starting line together is better than not being in the race at all.

  • -1

    herefornow

    President Barack Obama, who is expected to announce the general outlines of the Trans-Pacific Partnership in Hawaii, hopes that trade will stimulate job growth which he desperately needs as he seeks re-election next year.

    Yubaru -- really? Do you know the difference between figurative and literal? If not, just read above. And then ask yourself if Japan was only considering joining a trade deal with Chile, Brunei, New Zealand and Singapore if there would be the uproar about all this.

  • 0

    icanthinkofone

    I have very limited knowledge about the details of this, but if it get Japan out of stagnation I think it will be for the better.

    Some people aren't going to be happy, but the "current state of their system" isn't working out too well.

    It would be nice to see Japan produce "world-class" products again.

    Let's hope it works out well. Trade doesn't have to be a zero sum game - unless you are trading with a currency manipulator like China who plays by the rules when it's to their benefit but ignore them otherwise ...

  • 0

    icanthinkofone

    @CrazyJoe

    Noda also told Obama that Japan is in the process of easing US beef import restrictions. He's got a lot of explaining to do to the Japanese public.

    Nah. Japanese politicians have a "get out of jail free" card when it comes to stuff like that.

    All they have to do is say it's due to "Foreign Pressure" and they get of scot-free.

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