Washington — President Barack Obama has "serious concern" about Japan's auto trade policy, a senior administration official said Tuesday. Acting U.S. Trade Representative Demetrios Marantis told the Senate Finance Committee that the administration wants to see Japan make more progress on auto issues.
Last week, Japan asked to join the Trans-Pacific Partnership free trade talks, a group of 11 nations led by the U.S.
Detroit's Big Three automakers, many members of Congress and the United Auto Workers union oppose letting Japan join the talks, known as TPP, that have been going on since November 2011.
"We have a long history with Japan on automotive issues. It's a serious concern to the president and we are working very hard to ensure that should Japan join the TPP that we are able to address the long-standing issues that we have in the auto sector," Marantis said. "We've made progress with Japan but our work continues."
Sen. Debbie Stabenow, D-Lansing, said the Japanese market has been essentially closed to U.S. companies "for 80 years." She said for every 120 vehicles Japanese automakers export to the United States, Detroit's Big Three sell one vehicle in Japan.
"We can't allow them to have more access to our market without also having access to their market in the major areas which they export to us, which is automobiles," Stabenow told Marantis. "This is the No. 1 issue that our American automobile industry is concerned about."
The Obama administration faces heavy pressure from Detroit's automakers and the United Auto Workers, who fear that dropping U.S. tariffs could lead to the loss of thousands of jobs if Japan doesn't do more to open its market to imports. They point to trade agreements reached with Japan that haven't led to a dramatic increase in exports.
UAW President Bob King reiterated Monday the union opposes Japan's entry into the Trans-Pacific Partnership "because their inclusion would undermine our nation's ongoing economic recovery. Japan's inclusion in the TPP would cost the loss of tens of thousands of automotive manufacturing jobs in the United States because of long-standing closed markets."
The Japan Automobile Manufacturers Association strongly supports Japan's decision to join the talks.
The group's chairman, Akio Toyoda, who is Toyota's president, said the "establishment of high-level economic partnership would, among other benefits, promote free trade and provide common rules across a variety of sectors such as investment, trade facilitation and intellectual property rights which generally advance business opportunities in the region."
Last week, 48 members of Congress including nine senators said allowing Japan to join free-trade talks with 10 other nations could lead to more Japanese auto imports and fewer American auto jobs.
The United States and 11 other nations — including Canada and Mexico — have been in talks since 2011 aimed at creating a massive free trade zone that would eliminate all tariffs and barriers among the nations. Japan has stayed out of the talks.
Japanese Prime Minister Shinzo Abe's ruling Liberal Democratic Party approved letting Japan join if the world's third-largest economy can keep in place tariffs on key agriculture products, including rice, wheat, beef and sugar.