TOKYO: Japan’s leader heads to Washington eyeing the potential prize of a huge trade deal that would anchor his “Abenomics” plan for future economic revival, while still dogged by his nation’s wartime past.
Shinzo Abe will become the first Japanese prime minister to address a joint session of Congress next week, where he will showcase Japan’s evolution from sworn enemy to loyal US ally at a time when China is on the march.
On the table for White House talks with President Barack Obama is the Trans-Pacific Partnership (TPP), a US-led initiative to tear down trade barriers covering 40 percent of the world economy that excludes China.
A deal between Japan and the United States would push the 12-nation pact much closer to reality after years of talks, beating Beijing’s rival bid for a common trade region in east and southeast Asia.
It would also help the two allies seize back the initiative after China’s launch of the Asian Infrastructure Investment Bank, which saw dozens of US allies signing up, to Washington’s discomfort.
For Abe, the TPP could transform Japan’s cossetted agriculture sector, stripping out some of the enormous tariffs under which Japanese farmers have long sheltered.
That would deliver a decent chunk of the “third arrow” of his “Abenomics” overhaul of the world’s third-biggest economy: structural reform.
The first two arrows have been fired already as Abe bids to drag Japan out of more than two decades of stagnation: fiscal stimulus by the government, and drastic monetary easing by the Bank of Japan.
But economic recovery is not a done deal, and neither is the TPP. Obama faces opposition from labor unions and members of his Democratic Party, who warn it could put American jobs at risk.
Abe leaves Sunday for a week-long visit that will also include stops in San Francisco, Los Angeles and Boston. The centerpiece will be his speech to Congress on Wednesday.