Pence calls for broader U.S-Japan bilateral trade pact

14, Nov. 2018

TOKYO, Kyodo - U.S. Vice President Mike Pence urged Japan on Tuesday to strike a bilateral trade deal on goods and services, indicating Washington will seek a broader framework despite an agreement by the two counties earlier this year to begin talks on goods only.

"We are confident that this agreement will establish terms on goods, as well as on other key areas, including services," Pence said at a joint press conference after meeting with Japanese Prime Minister Shinzo Abe in Tokyo, referring to the agreement on the start of Japan-U.S. trade talks.

U.S. President Donald Trump and Abe agreed in September to begin negotiations for a trade agreement on goods, not including other items such as services.

Pence said the United States has had a trade imbalance with Japan for "too long" and American products and services "too often" face barriers to compete fairly in Japan. Abe said the two agreed to expand further bilateral trade and investment that are beneficial to both countries.

Japanese Chief Cabinet Secretary Yoshihide Suga said later Japan and the United States agreed to launch talks in line with the agreement in September.

"In this regard, there is no discrepancy in the recognition between Japan and the United States," the top government spokesman said.

The comment by Pence is the latest in a series of remarks by U.S. officials suggesting they are looking to a wide-ranging trade deal with Japan and heralds tough negations to come when they begin talks in mid-January.

Pence last month described the envisaged trade deal with Japan as a "free trade agreement," contradicting Tokyo's assertion that the accord sought by the two countries will not be as comprehensive as an FTA.

U.S. Treasury Secretary Steven Mnuchin said in October that Washington is seeking to include an agreement to prevent competitive currency devaluations in any trade deal with Japan, although an official at Japan's Finance Ministry immediately denied the possibility.

As the Trump administration is increasing efforts to reduce his country's more than $700 billion trade deficit, the United States has renegotiated trade pacts with Canada, Mexico and South Korea recently. Japan had the third-largest bilateral goods trade surplus with the United States totaling $68.85 billion in 2017.

For Japan, the agreement with the United States was a concession, as it sticks to its policy to pursue trade deals in multilateral frameworks.

Japan and 10 other countries are set to implement a trans-Pacific free trade pact on Dec. 30, a treaty the United States pulled out of when Trump took office. Abe's government also signed a trade treaty with the European Union in July.

Tuesday's meeting came at a time when speculation is growing in Japan that Trump will adopt a tougher stance after last week's midterm elections that delivered a divided Congress.

At a press conference the day after the elections, Trump said Japan is not treating the United States fairly on trade.

Apart from trade, Abe and Pence confirmed their cooperation in the denuclearization of North Korea, as they share the need to "completely" implement U.N. resolutions on Pyongyang to have it abandon its nuclear and missile programs.

The Japanese prime minister said at the press conference that they agreed to cooperate in settling the issue of Japanese nationals abducted by the North in the 1970s and 1980s, with Trump planning to have a second meeting with North Korean leader Kim Jong Un, following their first one in Singapore in June.

Abe and Pence reaffirmed their cooperation toward realizing a "free and open" Indo-Pacific region, a vision advocated by the Japanese leader and then backed by the United States amid China's increasing influence in the region.

Abe said he discussed with Pence bilateral cooperation in the fields of infrastructure, energy and digitalization in the region and confirmed their further cooperation with Australia, India and Southeast Asian nations to promote their joint efforts.

Pence said his country and Japan will offer $60 billion and $10 billion, respectively, to help in financing development and infrastructure projects in the Indo-Pacific region.

Prior to the meeting with Abe, Pence met with his counterpart Deputy Prime Minister Taro Aso, who doubles as finance minister, in the prime minister's office.

Pence stopped over in Tokyo during his Asian and Oceanian tour to attend annual regional summits later this week on behalf of the U.S. president.

Abe and Pence are scheduled to attend annual meetings of the Association of Southeast Asian Nations in Singapore and the Asia-Pacific Economic Cooperation forum in Papua New Guinea. (Kyodo)