The United States has told Japan during their recent ministerial talks it will keep tariffs on automotive parts under a Pacific Rim free trade initiative, retracting its previous plan to scrap them immediately, negotiation sources said Thursday.
The change in Washington’s stance over the automotive trade issue was the main reason the two sides failed to clinch a bilateral deal at a just-ended two-day meeting through Wednesday between Akira Amari, Japan’s minister in charge of the Trans-Pacific Partnership, and U.S. Trade Representative Michael Froman, the sources added.
The move is apparently out of consideration for the U.S. auto industry, which is a strong political support base for President Barack Obama’s Democratic Party, before U.S. midterm elections in November.
Under the TPP talks, Tokyo and Washington have been at odds over market access for autos and agricultural products. Tariffs and safeguard measures on Japan’s key farm products had been expected to be the main agenda, but talks on the problems made little progress as most of the time was spent on auto trade issues, the sources said.
With the arguments on U.S. tariffs on automotive parts brought up again, stagnated Japan-U.S. negotiations are certain to cast a shadow over talks for a broader 12-country TPP deal.