Saturday, January 31, 2015

Japanese PM Eyes TPP For Political Gains, But Effect On Joining Unclear

Posted: November 14, 2012

Japanese Prime Minister Yoshihiko Noda's public comments over the past few days, in which he indicated his political party would come out in favor of Japan joining the Trans-Pacific Partnership (TPP) in a new policy platform, leave unclear whether the prime minister will be able to make any real headway on joining or if the prime minister will only attempt to use the TPP issue for political advantage, according to experts following the issue.

Over the weekend, Noda said that joining TPP would form one plank of a forthcoming policy platform, or manifesto, for his Democratic Party of Japan (DPJ). This statement went beyond anything Noda has offered publicly as official government policy. While Noda would clearly like to join TPP if possible, the issue is divisive within his party, and he has only said formally that Japan wants to explore the possibility of joining the ongoing talks.

Noda's comments have already set off a backlash within his own party, and the prime minister appeared to back away somewhat from his comments early this week. Most experts did not believe that Noda would be able to lay the groundwork necessary to make any major announcement on TPP at the Nov. 18-19 East Asia Summit, which Noda and President Obama are attending in Cambodia.

Washington-based experts this week generally downplayed Noda's comments, saying that they likely reflect political machinations in Tokyo aimed at giving the DPJ an advantage in upcoming Diet elections more than a real shift in policy. Noda appears to think that making TPP a campaign issue would benefit him politically, they said.

Even if Noda is able to engineer a consensus within his own party to come out in favor of TPP, and therefore include joining TPP in a new DPJ platform, that alone would likely not do much to boost Japan's chances of joining TPP in the near term because Noda and his DPJ party are widely expected to lose their Diet majority in the next elections.

The opposition Liberal Democratic Party (LDP) is expected to pick up Diet seats and sweep into power, although it may only attain a plurality and will have to cobble together a coalition. Assuming the LDP becomes the new dominant force in the lower house of the Diet, Noda would lose his position as prime minister and any wording on TPP in the DPJ platform would become essentially meaningless moving forward, experts said.

"I think they are just playing politics with it," said James Schoff, senior associate at the Carnegie Endowment for International Peace, when asked about Noda's comments and whether it represented a real shift in policy.

U.S. stakeholders who want Japan to join TPP are hoping that Noda takes a bolder step and forges a consensus on joining TPP within his own cabinet before the upcoming elections. If such a consensus could be reached and announced, that would make joining TPP a formal policy position of the Japanese government, they noted.

If that happens -- and it is completely unclear if it will, especially in light of continued opposition from the Ministry of Agriculture, Fisheries and Forestry (MAFF) -- that could have an impact on Japan's chances of joining TPP in the near term even if the LDP comes into power in the elections, which are now slated to take place Dec. 16.

That is because, unlike in the U.S., formal Japanese government positions forged through cabinet consensus "carry over" somewhat to future administrations. The LDP could "slow walk" the decision to join TPP, thereby undermining it, or could disavow it completely, although in the latter scenario the LDP would have to explain why it was doing so, which could be awkward in light of the strong support for joining from Japanese business groups, experts said.

If the DPJ only supports joining TPP in its election platform -- but Noda does not forge a cabinet consensus on the issue before he presumably is kicked out of power -- some experts believe that that could, perversely, make it even more difficult for Japan to join TPP moving forward. That is because such a policy platform could force the LDP to "run against" TPP in the elections.

If, as expected, the LDP then comes into power, the party's leaders may be even more reluctant to reverse course and pursue joining TPP. Noda, who has long privately argued that Japan should join TPP, has largely put the issue on the back burner in order to concentrate on other domestic priorities, such as hiking the domestic consumption tax.

The first step towards new elections is for Noda to dissolve the current Diet, which he is now expected to do on Friday (Nov. 16). This clears the way for the elections to take place one month from now, and at some point before then, experts said, Noda's DPJ party will likely come out in favor of TPP, thereby making it a central campaign issue.

For Noda, there are distinct political advantages to coming out forcefully in favor of TPP. For instance, it puts Noda's political opponents in the difficult position of having to come out either "for" or "against" joining the trade talks. It would also give the DPJ a "positive agenda item" on which to run in the upcoming elections, experts said.

The LDP has taken a wary stance on TPP, questioning whether Japan should join given that it would involve comprehensive tariff elimination, though it has left itself some "wiggle room" on the issue. By stating that joining TPP will form a part of the new DPJ platform, Noda is likely trying to establish a clear difference between the DPJ and LDP parties, experts said.

There are other potential political advantages as well. For instance, several experts noted that two conservative factions of Japanese politics -- the Restoration Party and the Sunrise Party -- are trying to join forces in the next election. The leaders of these new parties are divided on TPP, and if this trade deal becomes a central election issue, it could make it harder for them to join forces and challenge Noda, experts said.

While it is unclear when the DPJ might release its new election platform, experts expected this to happen far enough in advance of the Dec. 16 elections to allow DPJ members to run on the issue, assuming that Noda is able to convince his fellow party members that this is a wise idea. Noda is likely hoping that Japanese business groups, who strongly support TPP, will then come out in favor of DPJ candidates and spur them to election victories.

But several DPJ members have already warned that they may leave the party if Noda comes out forcefully in favor of TPP, and the prime minister is likely weighing this consideration as well in light of the upcoming elections. One Japanese official cautioned that there are many -- perhaps even a majority -- of DPJ members who oppose participation in the TPP. The prime minister "fully understands the situation," this official said.

Until Japan decides what to do about TPP, experts said the U.S. will continue to push ahead in the TPP talks without Japan -- and will likely redouble efforts to conclude a deal now that the election season has passed. If and when Japan is in a position to realistically talk about joining in the near term, the White House would likely still be willing to entertain that request, as it is eager for Japan to join, experts said.

This is likely true even if Japan's participation would further delay conclusion of a deal, although one business source said TPP countries may consider how close they are to finishing a deal before letting any new countries join.

For U.S. stakeholders eager for Japan to join, the ideal scenario would be for Noda's DPJ to state explicitly in its new platform that the party supports joining TPP, and for Noda to ride that bold statement to reelection victory. Such a victory would also presumably give the DPJ a firm mandate on TPP, clearing the way for the resumption of intensive U.S.-Japan negotiations on autos and other issues complicating Japan's entry.

But even those experts eager to see Japan join conceded that this scenario is extremely improbable.

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