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Friday, Jan. 21, 2011
Biz-friendly Kaieda bullish on TPP
New trade minister sees symbolic upside to embracing regional free-trade pact with U.S.
Joining the Trans-Pacific Partnership Agreement will not only benefit the economy, it will also show the world Japan is moving to embrace free trade, newly appointed trade minister Banri Kaieda said in a recent interview.
Kaieda, who became minister of economy, trade and industry last week, also said he is doing his best to get the government in position this June to make a decision on the regional trade pact, which is being backed by the United States and eight other countries.
"Prime Minister (Naoto) Kan has shown such intention, therefore, my job is to move the process based on that," said Kaieda, who replaced Akihiro Ohata in the Jan. 14 Cabinet reshuffle.
Kaieda has been more aggressive in pushing Japan to join the TPP framework than his predecessor, who is now transport minister.
"Asia is the engine of global economic growth. The basic idea of the TPP is to bring that flow of growth to Japan," Kaieda said in a group interview with the media Tuesday.
Some people see the TPP as a Japan-U.S. free-trade pact because the gross domestic product of the two nations accounts for more than 90 percent of the GDP of all the participants combined, including New Zealand, Vietnam and Singapore.
Asked how the TPP will specifically benefit Japan, Kaieda avoided details but said the addition of Japan would have a strong symbolic impact.
"I think it will be a symbolic move for presenting Japan's open stance on free trade to the world," including China and European Union, which Japan does not have free-trade agreements with.
Though previously he had said the planned 5-point cut in the nation's 40 percent corporate tax may be inadequate compared with other countries, during the interview Kaieda said it was too early to tell if a further cut will be necessary since drastic tax reforms are in the works.
"We'll have to see how the corporate tax is positioned in the reform," he said.
"Business leaders have also said they will make efforts if the corporate tax is cut. Those efforts are to increase investment and create jobs," Kaieda said. "We'll have to see if such efforts will be made in a comprehensive way."
Kaieda, of the Democratic Party of Japan, is in his fifth term representing Tokyo in the Lower House. Before taking the trade portfolio, Kaieda served as economy and fiscal policy minister, a position now held by rival Kaoru Yosano, a former heavyweight in the Liberal Democratic Party.