Japan Braces for Biden’s Trade Policy

Biden and Suga’s first phone call . . .

Yesterday, US President Joe Biden and Japanese Prime Minister Yoshihide Suga spoke by phone for the first time since Biden took office last week. Biden reaffirmed the United States’ commitment to defending Japan if it were attacked, and the two leaders urged denuclearization of the Korean Peninsula. The two also agreed to continue to work with India and Australia on security in the Indo-Pacific region, while PM Suga welcomed President Biden’s move to keep the U.S. in the World Health Organization and to return to the Paris Agreement on climate change.

Still America first or a return to multilateralism?

While many anticipate a return to multilateralism under Biden’s leadership in contrast to Trump’s ‘America First’ policy, the new president has been equally vocal on prioritizing and protecting U.S. jobs and industry through a ‘foreign policy for the middle class.’ While Washington and Tokyo look to enhance their security co-operation, Japan anxiously awaits Biden’s trade agenda. But Biden has not yet spoken on whether he intends to re-open the 2020 bilateral trade agreement in which Japan lowered tariffs on U.S. agricultural products while the U.S. lowered duties on Japanese vehicles and industrial goods.

Japan’s trade outlook . . .

While Biden’s record stands largely in favour of trade liberalization, he has yet to comment on whether he intends to seek U.S. re-entry into the Comprehensive and Progressive Agreement on Trans-Pacific Partnership (CPTPP) since Trump’s withdrawal. Meanwhile, Japan may seek to deepen trade ties with existing partners, including members of the Asia-Pacific-focused Regional Comprehensive Economic Partnership and the CPTPP. Canada is a member of the latter. Within Japan, some politicians and corporate leaders have been gearing towards a softer China policy that would encourage warmer relations, particularly on trade. If President Biden’s focus on relaunching the U.S. economy does not include increased trade co-operation with Tokyo, it could end up further softening Japan’s stance towards Beijing.



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