<html><body style="word-wrap: break-word; -webkit-nbsp-mode: space; -webkit-line-break: after-white-space; "><a href="http://www.detroitnews.com/article/20130314/AUTO01/303140478/1361/Members-of-Congress-concerned-about-Japan-joining-free-trade-talks">http://www.detroitnews.com/article/20130314/AUTO01/303140478/1361/Members-of-Congress-concerned-about-Japan-joining-free-trade-talks</a><br><div><br></div><div><div style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; line-height: 13px; font: normal normal normal 13px/normal Helvetica; ">March 14, 2013 at 5:30 pm</div><p style="margin: 0.0px 0.0px 20.0px 0.0px; line-height: 30.0px; font: 30.0px Helvetica"><b>Members of Congress concerned about Japan joining free-trade talks</b></p>
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<li style="margin: 0.0px 0.0px 0.0px 0.0px; line-height: 16.0px; font: 12.0px Helvetica">By David Shepardson</li>
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</ul><p style="margin: 0.0px 0.0px 12.0px 0.0px; line-height: 16.0px; font: 12.0px Helvetica"><i>Washington - </i>More than 48 members of Congress, including nine senators, said allowing Japan to join free-trade talks with 10 other nations could lead to more Japanese <a href="http://www.detroitnews.com/article/20130314/AUTO01/303140478/1361/Members-of-Congress-concerned-about-Japan-joining-free-trade-talks#"><span style="text-decoration: underline ; color: #3d951b">auto</span><img alt="icon1.png" height="10" width="14" src="cid:CA37905D-0BD9-4B69-9BF0-FC3F88CAB403@hsd1.or.comcast.net."></a> imports and fewer American auto jobs.</p><p style="margin: 0.0px 0.0px 12.0px 0.0px; line-height: 16.0px; font: 12.0px Helvetica">Their letter to President Barack Obama comes as Japanese media reports suggest Prime Minister Shinzo Abe could formally ask as early as Friday to join the Trans-Pacific Partnership talks, after meeting with Obama last month.</p><p style="margin: 0.0px 0.0px 12.0px 0.0px; line-height: 16.0px; font: 12.0px Helvetica">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. But Japan has so far has stayed out of the talks.</p><p style="margin: 0.0px 0.0px 12.0px 0.0px; line-height: 16.0px; font: 12.0px Helvetica">Abe's ruling Liberal Democratic Party approved letting Japan join if the world's third-largest economy can keep in place tariffs on key <a href="http://www.detroitnews.com/article/20130314/AUTO01/303140478/1361/Members-of-Congress-concerned-about-Japan-joining-free-trade-talks#"><span style="text-decoration: underline ; color: #3d951b">agriculture</span><img alt="icon1.png" height="10" width="14" src="cid:FF5A8423-8F7A-495C-BF8E-C99E4F80B48B@hsd1.or.comcast.net."></a> products, including rice, wheat, beef and sugar.</p><p style="margin: 0.0px 0.0px 12.0px 0.0px; line-height: 16.0px; font: 12.0px Helvetica">In the letter sent Thursday, the members of Congress, including Michigan Sens. Carl Levin and Debbie Stabenow, and Reps. Sander Levin John Dingell, John Conyers, Dan Kildee, and Gary Peters, raised concerns about allowing Japan to take part, but stopped short of formally calling on him not to let Japan into the talks.</p><p style="margin: 0.0px 0.0px 12.0px 0.0px; line-height: 16.0px; font: 12.0px Helvetica">"American automobile companies and workers those at the forefront of today's economic recovery have been forced to compete for decades on a fundamentally unlevel playing field," the letter said. "A flawed, one-way trade agreement that benefits Japan at the expense of the United States businesses and workers will not help strengthen this vital relationship."</p><p style="margin: 0.0px 0.0px 12.0px 0.0px; line-height: 16.0px; font: 12.0px Helvetica">The Obama administration faces heavy pressure from Detroit's Big Three automakers and the United Auto Workers union, 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.</p><p style="margin: 0.0px 0.0px 12.0px 0.0px; line-height: 16.0px; font: 12.0px Helvetica">The letter noted that if the U.S. agreed to drop car and truck tariffs on Japanese exports under a free trade deal, it "would be a major benefit to Japan without any gain for a vital American industry, leading to more Japanese imports, less American production, and fewer American jobs."</p><p style="margin: 0.0px 0.0px 12.0px 0.0px; line-height: 16.0px; font: 12.0px Helvetica">On Wednesday, U.S. Trade Representative Ron Kirk said the countries are making progress as the talks "shift into a higher gear." Obama said in his State of the Union address he wants a deal by the end of the year. The next round of talks is set for May 15-24 in Lima, Peru.</p><p style="margin: 0.0px 0.0px 12.0px 0.0px; line-height: 16.0px; font: 12.0px Helvetica">Last month, the Obama administration said Japan needs to do more to address concerns raised that its market is largely closed to auto imports, but didn't rule out letting Japan join the talks.</p><p style="margin: 0.0px 0.0px 12.0px 0.0px; line-height: 16.0px; font: 12.0px Helvetica">Japanese automakers note the auto imports to Japan have been rising and question whether U.S. automakers are offering the right types of vehicles to meet Japanese consumer preferences.</p><p style="margin: 0.0px 0.0px 12.0px 0.0px; line-height: 16.0px; font: 12.0px Helvetica">A study released in August by the Center for <a href="http://www.detroitnews.com/article/20130314/AUTO01/303140478/1361/Members-of-Congress-concerned-about-Japan-joining-free-trade-talks#"><span style="text-decoration: underline ; color: #3d951b">Automotive</span><img alt="icon1.png" height="10" width="14" src="cid:6A0CD9BA-EEE4-42D2-ADEC-F422D22F9BE3@hsd1.or.comcast.net."></a> Research partially underwritten by Ford says Japanese vehicle exports to the United States would increase by 105,000 units or $2.2 billion up 6.2 percent if the 2.5 percent car tariff was eliminated. The study argues that U.S. vehicle production would fall by 65,100 units, which the study estimates would result in a loss of 2,600 direct U.S. automotive manufacturing jobs. An additional loss of U.S. supplier jobs is estimated at 9,000 and the loss of spin-off jobs at 14,900.</p><p style="margin: 0.0px 0.0px 12.0px 0.0px; line-height: 16.0px; font: 12.0px Helvetica">The Obama administration notes trade investment in Japan already supports a million U.S. jobs. The U.S. has the world's largest economy and Japan the world's third largest.</p><p style="margin: 0.0px 0.0px 12.0px 0.0px; line-height: 16.0px; font: 12.0px Helvetica">The letter said Japan has purposely kept most auto imports out.</p><p style="margin: 0.0px 0.0px 12.0px 0.0px; line-height: 16.0px; font: 12.0px Helvetica">"Nowhere is the closed nature of Japan's markets more evident than in the auto sector, where Japanese policies and practices have been carefully honed over generations to keep out American and other foreign cars and parts," they wrote. "Japan's significant, long-standing and persistent economic barriers put in place to block our exports and support theirs have hurt American workers and businesses for decades."</p><p style="margin: 0.0px 0.0px 12.0px 0.0px; line-height: 16.0px; font: 12.0px Helvetica">The letter said Japan the third-largest auto market in the world ranks last among developed nations in terms of auto market import penetration, at 5.9 percent last year.</p><p style="margin: 0.0px 0.0px 12.0px 0.0px; line-height: 16.0px; font: 12.0px Helvetica">The U.S. Trade Representative's Office said "through our extensive congressional and stakeholder outreach, we are well aware of concerns expressed regarding Japan and TPP. We are working to address these concerns in our bilateral TPP consultations."</p><p style="margin: 0.0px 0.0px 12.0px 0.0px; line-height: 16.0px; font: 12.0px Helvetica">The American Automotive Policy Council, which represents Detroit's Big Three automakers, opposes Japan's entry into the talks.</p><p style="margin: 0.0px 0.0px 12.0px 0.0px; line-height: 16.0px; font: 12.0px Helvetica">"To date, Japan has not indicated a willingness to change its decades-long practice of maintaining a closed automotive market. Given the systemic trade imbalance and lack of willingness to reform, a U.S. free trade agreement with Japan would only lock-in the already one-way trade relationshipJapan's closed auto market has created," said AAPC president Matt Blunt. "Japan's inclusion wouldsignificantly delay, if not prevent,proceeding with a high-quality TPP trade agreement with other more compatible trade partners in the important and rapidly growing Pan-Pacific region."</p><p style="margin: 0.0px 0.0px 12.0px 0.0px; line-height: 16.0px; font: 12.0px Helvetica">U.S. automakers have long insisted that Japan is building too many cars at home.</p><p style="margin: 0.0px 0.0px 12.0px 0.0px; line-height: 16.0px; font: 12.0px Helvetica">"Japan's auto sector is already producing over 11 million automobiles despite having only a 5 million automobile domestic market. As its population ages and shrinks, this export pressure will only increase," the letter said. "Moreover, it appears that Japanese auto producers have been able to sell some products in Japan at high prices and then to use the proceeds of those high-priced sales to sell into the U.S. market at low prices. For example, the current price of a Lexus IS 350 is $50,037 in Japan, but only $40,220 in the United States."</p><p style="margin: 0.0px 0.0px 12.0px 0.0px; line-height: 16.0px; font: 12.0px Helvetica">Japan is the second-largest source of the U.S. trade imbalance after China, and, in 2012, automotive products accounted for more than two-thirds of the deficit, the members said.</p><p style="margin: 0.0px 0.0px 12.0px 0.0px; line-height: 16.0px; font: 12.0px Helvetica">The letter noted the auto trade deficit has jumped from $31 billion two decades ago to $53.5 billion in 2012.</p><p style="margin: 0.0px 0.0px 12.0px 0.0px; line-height: 16.0px; font: 12.0px Helvetica">The members say other trade deals with Japan have failed to open the market to U.S. exports.</p><p style="margin: 0.0px 0.0px 12.0px 0.0px; line-height: 16.0px; font: 12.0px Helvetica">They note Japan's elimination of auto tariffs in 1970s or the repeated negotiation of agreements to eliminate barriers to American autos in 1980s and 1990s including the Market-Oriented Sector-Selective talks in 1986, the Structural Impediment Initiative talks launched in 1989, and the 1995 U.S.-Japan Auto Agreement. "None of these agreements has resulted in barriers coming down and American exports going up," they wrote.</p><p style="margin: 0.0px 0.0px 12.0px 0.0px; line-height: 16.0px; font: 12.0px Helvetica; color: #164273"><a href="mailto:dshepardson@detroitnews.com"><i>dshepardson@detroitnews.com</i></a></p><p style="margin: 0.0px 0.0px 12.0px 0.0px; line-height: 16.0px; font: 12.0px Helvetica"><i>(202) 662-8735</i></p><div style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; line-height: 13px; font: normal normal normal 13px/normal Helvetica; min-height: 16px; "><br></div><div style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; line-height: 13px; font: normal normal normal 13px/normal Helvetica; min-height: 16px; "><br></div><div style="margin-top: 0px; margin-right: 0px; margin-bottom: 0px; margin-left: 0px; line-height: 13px; font: normal normal normal 13px/normal Helvetica; color: rgb(10, 53, 148); "><span style="color: #000000">From The Detroit News: <a href="http://www.detroitnews.com/article/20130314/AUTO01/303140478#ixzz2NYgflcII">http://www.detroitnews.com/article/20130314/AUTO01/303140478#ixzz2NYgflcII</a></span></div></div></body></html>