March 28, 2014 / 11:37 PM / 4 years ago

U.S. must show flexibility for Pacific trade breakthrough: Japan

WASHINGTON (Reuters) - Japan said on Friday it would be difficult to achieve a breakthrough in talks with the United States on a Pacific trade deal in time for President Barack Obama’s trip to Asia next month unless Washington shows flexibility.

The two sides had made “very slow but steady progress” in talks in Washington this week on the Trans-Pacific Partnership (TPP), Japan’s deputy chief trade negotiator Hiroshi Oe told reporters.

Asked if a breakthrough was possible before Obama’s visit to Japan and other parts of Asia from April 22, Oe said this would be “difficult.”

“In order to make a breakthrough, the United States has to show flexibility,” he said.

Oe said the two sides had agreed on the need to conclude the negotiations as soon as possible after a call by Obama and Japanese Prime Minister Shinzo Abe to speed up the process.

He said he hoped U.S. negotiators would travel to Japan for more talks ahead of Obama’s visit.

Oe spoke after a fourth round of bilateral negotiations in a little over a month in which the two sides have been seeking to break an impasse over sensitive issues holding up completion of the TPP, which involves 12 Pacific Rim nations.

Oe declined to say in which areas there had been progress.

The United States wants Japan to open up its rice, beef and pork, dairy and sugar sectors while Japan is keen for a timetable on U.S. promises to drop tariffs of 2.5 percent on imports of passenger cars and 25 percent on light trucks.

The TPP is the central economic pillar of Obama’s strategic “pivot” toward Asia in the face of growing Chinese power in the region.

Advocates say the TPP could accelerate global economic growth, boost U.S. exports and level the playing field between emerging and rich nations in one of the world’s biggest trade pacts, covering about one-third of global trade.

The United States had hoped to complete the agreement, which includes Canada, Mexico, New Zealand, Malaysia and others, by the end of last year but many issues are still on the table.

Japan’s food safety rules as well as tariffs and quotas are a source of concern for trading partners as farmers in big agricultural exporting nations push for the elimination of all tariffs.

Autos are also a source of contention. U.S. automakers complain that Japan, where imported cars make up less than 10 percent of the market, sets up barriers to imports such as strict dealership limits, regulation and taxes, even though there are no tariffs.

Japanese automakers argue that U.S. manufacturers are not producing and marketing enough of the small cars that are popular with domestic consumers.

Reporting by David Brunnstrom; Editing by Lisa Shumaker

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