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Sunday, Nov. 14, 2010
TPP signals commitment to Asia: Obama
U.S. impatient to join pact after its exclusion from other frameworks
YOKOHAMA — The Trans-Pacific Partnership Agreement will give Washington a strong presence in Asia and an opportunity to increase trade, U.S. President Barack Obama said Saturday in Yokohama.
"Agreements like this will benefit our economies and our people but they will also send a strong signal," Obama said to business execs at the APEC CEO Summit before the leaders of the Asia-Pacific Economic Cooperation forum kicked off their two-day meeting here later in the day. "When it comes to this growing, sprawling region of the world, the United States is here to stay."
Originally a small free-trade pact signed by Brunei, Chile, New Zealand and Singapore in 2005, the TPP began gaining attention after Obama said last year in Tokyo that the United States planned to join the pact. Negotiators are now vying to expand the Pacific-wide free-trade pact to nine nations.
Obama's commitment to the TPP reflects Washington's growing impatience with its exclusion from various economic frameworks in the region, including the proposed East Asia Free Trade Agreement, which involves the Association of Southeast Asian Nations plus China, South Korea and Japan.
"Even though our exports in this region have risen by more than 60 percent over the last five years, our overall share of trade has declined in face of our competitors and we want to change that," Obama said. "We don't want to lose the opportunity to sell our goods and services in fast-growing markets."
Japan, afraid to be left out of the loop, has said it will open consultations with TPP members, but an official stance on joining the pact has been delayed until June to avoid upsetting the nation's highly protected farmers.
"We will quickly deal with measures to overcome the domestic environment and at the same time start consultations with nations involved," Prime Minister Naoto Kan said in his speech at the CEO summit. "We will pursue free trade and agricultural reform."
Kan, eager to declare Japan's interest in joining the pact, instead emphasized the goal of reviving the domestic farm sector to make it strong enough to compete in the global market.
Obama, who arrived in Tokyo Friday evening after attending the Group of 20 leaders' summit in Seoul, said he is committed to resolving any remaining obstacles to the signing of a bilateral FTA with South Korea in the weeks to come.
"The completion of this deal can lead to billions of dollars in increased exports and thousands of jobs for American workers," he said. "So I am committed to seeing this through."
Although the agreement was signed in 2007, Congress hasn't ratified it because of lingering issues over access to South Korea's auto and beef markets. The two sides redoubled their efforts but failed to reach a deal by the time Obama came to Seoul.
Japanese businesses are closely monitoring the situation. If the FTA goes through, it will abolish the 2.5 percent tariff on cars and the 25 percent tariff on trucks, giving South Korean automakers the upper hand in the U.S. market.
Addressing trade, Obama said nations should not stop depending on exports to the U.S. to ensure their growth.
"Going forward, no nations should assume that their path to prosperity is simply paved with exports to America," the president said. "Countries with large surpluses must shift away from unhealthy dependence on exports and take steps to boost domestic demand," he said, alluding to China's huge trade surplus with the United States.
The U.S. trade deficit with China, worth $226.9 billion in 2009, has been fueling trade disputes, and the U.S. is also accusing China of deliberately keeping its currency, the yuan, undervalued to gain a trade advantage.
Chinese President Hu Jintao, meanwhile, said at the same gathering that Beijing will remain committed to reforming its exchange rate "in a self-initiated, controllable and gradual manner."
Hu further said China will continue to pursue balanced growth of domestic and external demand.