As our top destination for beef exports, Japan drew a lot of attention during the USMEF trade talk. It was particularly attention-getting since President Donald Trump’s international trip had him scheduled in Japan Nov. 5-7.
Tariffs were the main topic of Japan-related trade talks, however.
“As a result of the United States leaving [the Trans-Pacific Partnership (TPP)], we were left at a disadvantage as a result of the fact that the Australians had signed an accord with Japan a couple years ago,” lamented Phil Seng, USMEF’s CEO.
“Today, if you compare our duties at 38.5 percent, the Australians are 27.2 percent. This is a significant difference.”
On Aug. 1 this summer, Japan implemented its “safeguard duty” on frozen beef after the triggering level of imports had been reached for the year.
“So right now, on frozen product, we are sitting with a 50 percent duty and Australia has a 27.2 percent duty,” Seng continued, adding that frozen beef exports to Japan in August were down 26 percent.
Earlier, in mid-October, there were talks of renegotiating the way Japan’s safeguard duty works, as well as the possibility of a bilateral trade agreement with Japan. For instance, on Oct. 11, Texas rancher Kelley Sullivan testified before the House Ways and Means Subcommittee on Trade on the importance of secure trade deals with Asian customers.
“We need to aggressively pursue a bilateral agreement with our No. 1 trading partner, Japan, right now,” she said in answer to questions posed by subcommittee members.
Seng said the prospect of a bilateral trade agreement is not likely a high priority for Japanese Prime Minister Shinz? Abe during Trump’s trip to Japan. Seng said Abe’s top priorities right now are defense and revitalizing its economy.
“When it comes to revitalizing the economy, a subset of that, of course, would be their trade agenda,” Seng conceded, but added that Japan is focusing on concluding TTP as well as other trade agreements with the EU and China.
“So the U.S. FTA really comes in at fourth place,” he concluded. “MEF is interested in seeing anything that could be done, whether it be some kind of TPP engagement—which would be the quickest as far as acceptance in Japan and be the less acrimonious. But if it’s an FTA (free trade agreement), we would be happy to see that come to fruition as well, but I think that would be much, much longer, just looking at [Japan’s] trade agenda.” — WLJ
