WASHINGTON -- The U.S. and Japan failed to reach agreement on free-trade talks as President Obama left Japan on Friday without the breakthrough needed to advance a key element of his broader agenda of strengthening America’s hand in Asia.
Despite a last-minute push through the night, the two sides could not bridge their differences on tariffs and market access, clouding the prospects for the proposed free-trade pact among a dozen nations that include the U.S., Japan, Canada and Mexico.
Obama had hoped to come away from his two-day summit with Japanese Prime Minister Shinzo Abe with a bilateral deal that would propel the stalled Trans-Pacific Partnership negotiations to a conclusion.
Instead, as Obama headed for South Korea, the second stop of his four-nation Asia tour, the U.S. and Japan issued a statement that made clear they had fallen short of their goal. Although it said that they “have identified a path forward on important bilateral TPP issues,” the statement gave no specifics and noted that “there is still much work to be done to conclude TPP.”
Japan’s economic minister, Akira Amari, was more direct, telling reporters Friday morning that there was progress but no accord.
Although he did not provide details, analysts have said the most contentious issues have been over Japanese tariffs on beef, pork and other politically sensitive farm goods, which the U.S. wants eliminated.
Thursday evening there was still hope for a compromise after Amari had concluded a session with Michael Froman, the U.S. trade representative. Negotiators continued to talk through the night, with plans that Amari and Froman would meet again Friday morning before Obama left, Japanese officials said. But that meeting was canceled.
Froman’s office released the joint statement but did not provide additional comment.
A U.S.-Japan accord is vital because the two countries are the largest and third-largest economies in the world, constituting the bulk of the economic activity among the dozen Trans-Pacific Partnership nations, which also include Australia, Vietnam and Malaysia, but not China. The U.S. has a separate free-trade agreement with South Korea, which also isn’t involved in these negotiations.
The U.S. had hoped to wrap up the Trans-Pacific Partnership deal at the end of last year, but its future is now even more uncertain. The deal has been touted by the Obama administration and its supporters as groundbreaking in that it would not only remove tariffs but also establish rules and standards on such critical trade and investment matters as intellectual property rights and government subsidies to enterprises.
Analysts have described the deal as the economic centerpiece of the Obama administration’s promised rebalance of foreign policy priorities to Asia-Pacific, a fast-growing region that is the heart of global trade and where China has become an increasing commercial and military force.