Obama seeks boost for flagging trade agenda in Asia-Pacific trip

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President Obama is heading to the Asia-Pacific next week to try and build support for a massive trade deal that is central to his economic agenda and America’s strategic pivot toward the region.

The White House is intensifying efforts to wrap up the Trans-Pacific Partnership (TPP), which would expand trade from the Pacific Rim to Latin America, but is struggling to break a stalemate with Japan over market access. The pact is also facing staunch opposition from congressional Democrats. 

Obama is looking to build momentum for the deal during a four-nation Asia trip.

The key meetings will come Wednesday and Thursday, when Obama and Japanese Prime Minister Shinzo Abe are expected to review the status of outstanding negotiating issues in Japan’s sensitive auto and agricultural sectors.

The president is expected to underscore the importance of Japan’s participation in the TPP for both economies while reminding Tokyo of its commitment to refrain from slowing down the talks or reopening closed issues, a senior administration official told reporters on Friday. 

Susan Rice, the president's national security adviser, said negotiators have made a great deal of progress over the last few months on the trade deal “and we expect very much that the president's travels and our continued work in the coming weeks and months on TPP will continue to yield progress.”

“We expect that as a result of that, we will be able to conclude an agreement,” she said. 

Trade analysts don’t expect Obama to single-handedly break the logjam between Tokyo and Washington, but they are hoping a dose of diplomacy will propel the negotiations forward.

“We expect them to come out and say that, ‘We see a way forward and we’re very optimistic in getting this done as quickly as possible,’ ” said Tami Overby, vice president for Asia at the U.S. Chamber of Commerce. 

“We have an opportunity to take full advantage of these meetings and we hope that our Japanese friends do that, too,” she said.

A bilateral deal between the U.S. and Japan, which is being worked out on a parallel track with TPP, could boost the chances of completing the trade deal. 

Even though negotiations have been a heavy lift, Obama won’t have a hard time persuading Abe, who hopes that completion of the TPP can revive Japan’s sluggish economy.

A senior administration official said Friday that Abe wants to strike a deal, and that the hardest part for Japan and its negotiators is to take a massive step into a realm where Tokyo has never gone before. 

Meanwhile, Abe has struggled to convince politically powerful farming co-ops that the agricultural sector needs a structural overhaul and that tariffs can be dropped on five “sacred” agricultural areas: rice, meat, wheat, dairy and sugar.

“They are really trying to move forward in a way that allow them to do this,” said Jim Fatheree, president of the U.S.-Japan Business Council at the Chamber. 

“We’re the ones everyone is looking at to break through the current logjam,” he said.

Fatheree said Abe is trying to “thread a needle” in support of Tokyo’s long-term economic interests. 

The trip also weighs heavily on the president’s hopes of gaining congressional support for his trade agenda.

During a brief side meeting at The Hague last month, Obama and Abe agreed to accelerate TPP talks, Fatheree said. 

There has been no expectation that a deal could be ready in time for the Obama-Abe meetings, and chief negotiators were already scheduled to meet next month in Vietnam to continue talks.

“At this critical juncture the U.S. government can ill afford to let the TPP talks stall,” said Mireya Solis, a senior fellow at the Brookings Center for East Asia Policy Studies, in a blog post this week.

Ahead of next week’s summit, discussions between top trade officials have continued in earnest. 

U.S. Trade Representative Michael Froman recently traveled to Japan, and he and Akira Amari, Japan’s minister for economic and fiscal policy, wrapped up another round of talks on Friday in Washington.

The USTR’s office called the discussions “focused but difficult,” but said negotiations yielded more progress “and we are now faced with a reasonable number of outstanding issues.”  

“These issues are important to both sides and considerable differences remain,” the statement said. 

The goal is to continue peeling away the layers of Japanese protections on their agriculture and auto sectors to achieve meaningful market access, a senior administration official said of the TPP negotiations. 

Obama will spend three days in Japan on the state visit — a situation where more pomp and circumstance is required — giving top government officials a chance to tout the relationship between Washington and Tokyo. 

Obama’s swing through the Asia-Pacific includes stops in Malaysia, another TPP nation, as well as South Korea and the Philippines, each of which have expressed interesting in eventually joining the TPP.

Congress approved a free trade agreement with Korea in 2011. 

Critics of the Obama administration’s trade agenda say that TPP talks are floundering, putting the United States into a position to cave on high-priority issues such as tariff elimination that would open up Japan’s tightly controlled markets. 

“As the conventional wisdom goes, if Japan and the United States can sort out market access issues, agriculture, automobiles, then this massive trade deal can at last be concluded,” said Rep. Rosa DeLauro (D-Conn.), one of the pact’s leading opponents.

“This is not really the case. What the argument obscures is that TPP negotiators are grappling with many seemingly intractable problems,” she said.