Japan, U.S. at odds with PM Noda's free trade comment

HONOLULU Sun Nov 13, 2011 5:55am EST

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HONOLULU Nov 13 (Reuters) - Japan has denied a White House statement that Japanese Prime Minister Yoshihiko Noda told U.S. President Barack Obama he would put all goods and services on the negotiating table for trade liberalisation.

The White House stood by its statement, issued on Saturday, despite Japan's denial.

The discrepancy comes after Noda held talks with Obama at a meeting of Asia-Pacific leaders in Hawaii and notified the president of his decision to seek to join talks on a U.S.-led free trade pact, the Trans-Pacific Partnership (TPP).

"It is not true that Prime Minister Noda made such a comment in the summit meeting. We pointed out to the U.S. side that the statement in question is not true and asked for explanation," a Japanese government statement said.

"It has been confirmed that it is the U.S. side's interpretation based on the basic policy and explanation that the Japanese side has in the past announced or made, and that no such remark has been made (in the summit meeting)."

Asked about the contradiction, Michael Froman, senior White House adviser on international economics, defended the statement.

"I would stand by the statement that we issued earlier, that they discussed the comprehensiveness of TPP, the various issues that will have to be resolved between the two countries, and the consultation process that is the first step in that direction," he said.

When Noda declared Japan's readiness to join TPP talks on Friday in Tokyo, he said he was determined to protect the "world's renowned Japanese medical system, its traditional culture and beautiful farming villages".

The TPP would in principle eliminate all tariffs within member nations. Its rule-making talks have already been joined by the United States and eight other Asia-Pacific countries.

Noda holds high hopes that joining the free trade agreement would help Japan harness dynamic growth in the region and put vigour back into its economy.

But Japanese farming groups say TPP participation would be the death knell for Japan's agricultural sector, which has long been protected by high tariffs on farm products imports.

Farming lobbies are joined by the Japan Medical Association, a politically powerful group of doctors that is concerned that opening up the country to foreign competition could make the medical sector more profit-oriented and curb access to medical services for the poor. (Reporting by Kiyoshi Takenaka and Caren Bohan; Editing by Paul Tait)

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