Japan’s economic troubles may be pushing the country toward free-trade negotiations with the United States, a goal long sought by American officials who see it as a potential boon to two of the world’s industrial giants and to the U.S. presence in Asia.
Japan’s new prime minister, Shinzo Abe, meets with President Obama on Friday for their first face-to-face talks since Abe took office last year and launched an ambitious program to revive his country’s stalled economy.
Much about Abe’s plan is undefined, but it is already controversial. An expected monetary easing has prompted major nations to warn Japan against any moves aimed at devaluing the yen. Proposals for new government stimulus spending have led the International Monetary Fund to caution that those efforts should be short-lived and quickly give way to a taming of the government’s seemingly runaway debt.
What Abe calls the “third arrow” of his plan involves reviving growth in an economy that is aging and, since the 2011 Fukushima nuclear complex disaster, confronts both rising energy costs and a potential migration of its industrial base to places less prone to tsunamis and earthquakes. Those pressures, U.S. and Japanese
officials and analysts say, have built momentum behind the idea of Japan joining the 11-nation Trans-Pacific Partnership negotiations — a politically controversial step in which Abe would have to open several highly regulated local markets in return for the prospect of new investment, cheaper food prices and a potential energy lifeline in the form of natural gas imported from the United States. Nations that have signed a free-trade agreement with the United States have easier access to its energy exports.