tv Carnegie Endowment for International Peace on Japan Global Leadership CSPAN January 22, 2019 1:00pm-3:34pm EST
>> so you may know -- you do know that i'm on the senate intelligence committee, so i can't talk about the facts that i know. i will say this -- my highest priority and what i believe should be the highest priority of the congress is that bob mueller be able to finish his investigation. there are already 33 indictments that he has returned. clearly he is following the facts where they lead him. and there should be no interference. >> middle of the football game, we just went to the concession stand and stood in line at the restroom, and now we're ready to begin. we've got a great way to kick off the second half. before we turn it over to our keynote speaker, it's my pleasure to introduce the interim president of the japan-america society of washington, d.c., abigail friedman, founder and ceo of wisteria group, previous advisor to the asia foundation where she
led strategic engagement on japan and advised on other conflicted regions in asia. she also had a long career at the state department, and abigail's been a terrific leader at the society, and it's great to welcome her here at carnegie. [ applause ] >> thank you very much. if feels a little odd to introduce the introducer. but thank you all for coming here today. and we've got a great speaker who many of you already know because he's had such an illustrious career in the economic front, speaking today about international asia trade dynamics in 2019. he's currently the representative director of the economic research institute for northeast asia, erina, based e in nagata. which is interesting because so often we only see things
happening in tokyo or washington, d.c. that having someone who's based in a per perspectispective outs main city is great. our speaker is a professor -- he's a representative director of the economic research institute of northeast asia, but also a professor at the graduate school of public policy at the university of tokyo. he also served as -- previously as deputy vice minister of finance for international affairs at japan's ministry of finance. he's a stanford university graduate, has his masters and ph.d. in economics from stanford. and he began his career as a research fellow at brookings -- am i allowed to say that word here? and then he was an assistant, an associate professor in the economics department at johns hopkins. afterwards, he was a full
professor at the university of tokyo, and he also served during this time as a consultant at the board of governors of the federal reserve system and at the imf in washington, d.c. plea he's also worked as chief economist for the east asia an pacific region from 1998 to 2001. subsequent to that he was with the ministry of finance, the japanese ministry of finance. he also joined the asian development bank and served as head of the adb's office of regional economic integration, and special adviser to the adb president in charge of regional economic cooperation and integration. he's published a number of books and numerous articles on economic globalization on regional financial integration and cooperation in east asia, including lessons from the asian financial crisis and on the international currency system. so i think you can see from this
brief bio that he has covered the bases on the economic front and international trade. please join me in welcoming mr. kawai. [ applause ] >> good afternoon. it's a great honor and a pleasure for me to be here to talk about the japan-u.s. economic relations, and the future of tpp 11. i think i want to get a bit closer to the slide since i cannot -- i don't have it just in front of me.
maybe the best way would be to -- i see. okay. okay. thank you very much. ok okay. so president trump withdrew from tpp on day one or two after assuming his presidency, and japan started to lead negotiations on tpp 11. japan was then the largest economy among the 11 countries, so japan was a natural leader to do so. in the meantime, mr. trump
started to focus on trade issues to reduce trade deficits, and particularly he focused on china. he has been very tough on china. people around him were probably tougher toward china than mr. trump himself. but mr. trump also wants to forge fdas or trade agreements with the eu and japan which would be very favorable from the u.s. perspective, and he has been using the threat of imposing additional tariffs on automobile imports.
japan now started to work with other ten countries within the tpp 11 context to expand membership. japan also came up with an epa economic partnership agreement with the eu, and this epa is going to be enforced on february the 1st this year. japan has been also working with other east asian countries to forge the regional comprehensive economic partnership agreement. so japan and mr. abe has been
working intensively on mega fdas in supporting the liberal trading system for the -- not only japan but for asia and the road. so the question is where do we go from here. now we know that the u.s. has the largest trade deficit with china followed by the eu, mexico, and japan according to the number for 2017. so japan's trade surplus against the united states was not too gigantic in comparison to the -- to china's. still, mr. trump wants to reduce
deficits. japan has been pursuing its own fda strategy and economics as part of growth strategy and the japanese government has been making it clear that maintaining the rules-based liberal and multilateral world trading system under the wto would be the most important strategy for japan. for that purpose, japan has been working with the eu, other g7 countries, and like-minded countries to support the multilateral trading system.
and japan has been -- japan has continued to try to convince the u.s. to return to this multilateral trading arrangement. the u.s., mr. trump, has complaints of wto practices and, of course, wto has many problems, and together with the u.s. it's very fortunate that mr. lightheiser does support wto reform. and japan, the eu and the u.s. have been supporting wto reform. another important pillar of japanese trade strategy is to
convince china to return to reform an open policy which was successful but which was recently reversed through a small closed nature. and to shift away from the so-called state capitalism model to a truly market-oriented open economy development model. and also implementing several major ftas has been very important. that's why he wanted -- mr. abe wanted to revive tpp after mr. trump's withdrawal. now the data in the table a bit
old, but even though japan has been integrating with many other asian countries in terms of people's movement, trade, foreign direct investment through all of china, for that matter, has become very important. and economic relationship with our okay continues to be very important. but you realize that the u.s. is also a very important economic partner for outbound international tourism and trade, and for indirect investment. the u.s. is there economically in japan. and mr. abe came up with a kpi
key performance indicator with regards to its fta strategy. mr. abe wanted to achieve the fta trade coverage ratio of 70% by 2018 last year. this was not achieved, but still this policy continues to be important. so to achieve it, japan has to forge an fta with tpp 11 member countries and the u.s. also, and eu which will be realized very soon, and then korea and china.
so working with many countries continues to be quite important. for this audience, i don't think there is really need to re-emphasize the strakeejic importance of tpp, but just i want to say that tpp was a high standard fta including developing countries. so that was a very excellent attempt even by including developing countries, very high standard fta could be achieved, and actually tpp 11 has done so, and also tpp was intended to put pressure on china to further open up and to pursue further
reform. so in the future, china could be invited to be a member of tpp. so in a sense, tpp was a very important instrument to encourage china to go through important structural reforms, but mr. trump decided not to use that path. tpp 11 remains significant. tpp 11 was launched by six countries -- australia, canada, japan, mexico, new zealand, and singapore. and also this meant vietnam joined tpp 11. and three other countries, bruni, chile, and peru, are going through domestic
procedures. malaysia and another country -- signatory member of tpp 11 is now considering what they should be doing. hopefully, hopefully malaysia is soon ratified, but we don't know. tpp 11 member countries suspended 22 provisions, and i have a list of suspended provisions and items under tpp 11. most of the provisions and items suspended are related to
intellectual property rights. over half, half of the -- more than half of 20 suspended the provision provisions are related to intellectual property. so basically the provisions which the u.s. really insisted on putting in into tpp which many developing countries and even some developed countries like australia and new zealand did not quite appreciate, were put in place, but they were now suspended. they have been suspended. and even though there are these suspended items, still tpp 11
can be a model for the 21st century trade and investment rules. if the u.s. accepts the entirety of tpp text and does not demand anything more and if the u.s. wants to come back, the u.s. can come back and those suspended provisions would be restored. we may want to discuss later if the u.s. wants to do it, but if the u.s. wants to come back to tpp, will the u.s. accept the existing text of tpp? more likely the u.s. would like
to add something more to the text. then there would have to be a lot of negotiations between the u.s. and existing members of tpp 11. there are still economic benefits to tpp 11 even though the u.s. is not there. so economic benefits smaller than tpp which includes the united states, but still there are economic benefits. now membership epansion or t
tpp-11. japan and other tpp-11 countries believe that member -- membership expansion is going to send a strong message to the international community that these countries really care about liberal trading arrangements and multilateral systems. but there are -- there are several issues of several countries that still have not ratified tpp-11. those three countries plus malaysia, and so if new discussion starts with new potential members, then who
should be most seriously negotiating with the new memb s members? only those members, those tpp-11 members which have become legitimate members or that include other tpp members which have not ratified? those countries which have not ratified may be concerned about new members coming into members of tpp-11 because that may create competitive pressure for countries which have not ratifi ratified. another question is should very high standard be required in
terms of tariff reduction, tariff elimination. would loose agreement be possible? you may remember tariff discussions done on the bilateral basis. so between any two countries, there may be a lot of concessions given to particular countries. so there's some clarity about the direction toward tariff or market access issues, although trading investment rules of tpp-11 would have to be accepted
by new members. and also it may take some time to finalize tpp-11 expansion. there are several countries which have expressed interest to become tpp-11 members like colombia, thailand, indonesia, the philippines, taiwan, the uk, china has not -- has not expressed the interest, but china may be a future member, even the eu. but these countries do have various domestic issues. colombia after the new
government doesn't seem to be too keen -- there's seems to be some question about colombia's direction, thailand and colombia go through elections, so we have to wait until after the election outcomes are known. the philippines -- so the philippines may be concerned about its economic relationship, economic and political relationship with china under the current president. taiwan hasex-supprepressing strongly to join tpp and tpp-11 members may be concerned about possible conflict with china. you remember in the case of wto
entry, china insisted that china should enter the wto first, and then taiwan. okay. now, china and eu may be good candidates, but is it really a good idea to invite them in the absence of the united states? so there are many, many issues to think about. now prospects for rcep, the regional comprehensive economic partnership, this is an asean centered fta among the asean member states, plus japan, china, korea, india, australia,
and new zealand. so rcep is not as ambitious as tpp or tpp-11, but it's a very important mega fta because it does include china and india, china, india, and also a large country like indonesia. differences among the major countries are large, initially between japan and china on the level of tariff reduction and trade and investment rules, but after the start of u.s.-china trade war, china has softened. china wants to strengthen
economic friendship with the neighboring countries. but india, india has been a reluctant member. rcep also generates a lot of economic benefits mainly because china's level of protection is still high, and india's level of protection very high. now rcep negotiations out of the total 19 chapters, seven chapters have been basically agreed on. sh so some progress is going on, but there are difficult chapters
which are market access issues, in particular india is very much afraid of the negative impact of trade liberalization on domestic industries because already chinese -- cheap chinese products are now flowing into ind india, and india would be further exposed to chinese products. intellectual property, e-commerce, these are difficult issues, and differences in views among countries relatively large. but negotiation will likely be concluded this year. china's softening position, and
it depends on india's election outcome, hopefully modi continues to be support ed. india can be more forthcoming because a lot more time and leeway provided to india. and r krcep. india's per capita gdp is about the same as clmv countries. so treat india just like cambodia and laos. so india should be able to come. my paper contains rcep chapters and some progress made,
highlighted parts. it's difficult, a difficult part. now so next likely steps of tpp-11 is now in place, and a lot of progress will be made on rcep which would include, as i said, china and india. now, just in the middle or so, what are the prospects of t.a.g. or u.s. jta negotiations? japan calls this japan-u.s.
trade negotiation t.a.g., trade agreement on goods. the u.s. calls it u.s.-japan trade agreement. so there's some difference in approach. major issues between the u.s. and japan are autos and agricultural sector problems. the u.s. runs large trade deficits in automobiles. accounting for about three quarters of total u.s. bilateral deficits, vis-a-vis japan. i have some data. so automotive vehicles, parts,
and engines had a trade deficit for the u.s. of $53 billion. total trade deficit on goods for the u.s. was about $70 billion. so the automotive part is the most important part. so mr. trump wants to reduce this deficit, but that's very difficult. japan imports a very small amount of american automobiles, and japan exports a massive amount. how can this be adjusted? it's going to be very difficult. agricultural trade is also an important part, but the u.s.
runs a surplus on foods and fees. and the u.s. wants to increase this part, trade surplus on agricultural products. and also the u.s. is indicating a possible currency clause. now looking at the new nafta arrangement and the ongoing discussion about the nature of u.s. eu trade negotiations, the u.s. could demand a lot of thin things. so there are several key issues for the u.s.-japan negotiation. from the japanese perspective,
there are several things that should be avoid ed. very restrictive trade policies against the japanese auto imports. this is something that needs to be avoided. like on increasing tariffs, just mr. trump threatens or setting a numerical limit on imports of japanese autos in a binding way. in the case of a new nafta, it's not binding, but in the future the limit may bind. but we are very much concerned about the introduction of a binding limit. or other u.s. wants to set a high use of origin requirement
for auto trade between the two countries. in a case of new nafta agreement, the rules of origin requirement was increased. and currency clauses which may have implication s for monetary policy should be avoided because it continues to be expansionary, and there's no possibility at this point to exit from this ultra easy monetary policy. and now it's very vital for japan to maintain independent monetary policy, and japan will be ready to accept a comprehensive fta deal, not simply on goods, services,
investment, you know, other -- other issues, and japan can import more gas and -- also earlier, there was a discussion on the imports of military equipment which japan is doing. and japan can further open the agriculture market to the extent of original tpp and japan-eu epa deals. maybe japan could go a bit more if necessary. japan can invest more in auto plants in the united states to expa expand automobile industry capacity in the united states. so my conclusion, mr. trump has been very tough against china,
but so far against canada, mexico, the eu, and japan, the u.s. has been less tough which is -- which is good. but the u.s., eu, and japan need to make concerted efforts to work on china to induce changes in china. so the u.s. must work with the eu and japan and other like-minded countries. and also they have to work together to implement wto reform in an effective way, but of course this process will have to involve china. and japan and other tpp-level
member countries will start membership expansion, and japan, china, and other members will likely reach an early conclusion of rcep this year. and japan contributes to the u.s. economy by keeping to try to convince the u.s. that the free and multilateral trading system is the best. by purchasing goods from the u.s. and investing more in the auto and key manufacturing sectors in the u.s. and of course, japan and the u.s. share a lot of common interests going beyond bilateral
trade. china's change, china's reform, north korean issue, and free and open indo-pacific initiative to give economic substance to this indo-pacific initiative would be very, very important. thank you very much for your attention. [ applause ] >> thank you very much, professor kawai. that was quite excellent. i sort of wish we had a crystal ball and could say, okay, so
what does this look like for this and for that. we will open up for questions, but i will in the tradition here ask the first one. it's -- it's been interesting to me to watch the u.s. domestic approach to tpp as we all know was great resistance, this wasn't just something that president trump was against, but there was a bipartisan grassroots opposition which eventually killed tpp for the u.s. japan historically had a very powerful grassroots lobby that resisted international agreements, and yet here we now see japan taking the lead on tpp, signing the eu-japan fta, engaging with rcep. what's the -- what's the magic that's working that is making
this possible in japan? what's the japanese public reaction to this, what is the bein business community reaction to this? why is this working? >> okay. professor takuchi also discussed this issue earlier. japan had two decades of economic stagnation, and everybody understands that japan should get out of long-term economic stagnation. otherwise, the japanese debt would continue to expand relative to gdp, and social security system could be under stress. to avoid it, economic growth is needed. opening, market opening and more
proactively participating in the global economic management would be quite important and is necessary. and i think that's been accepted by the majority of people. and the only sector that has been complaining -- i should say almost the only sector is the agricultural lobby. but the japanese government has been spending a lot of money for tpp itself and japan-eu epa. now preparing for tpp-11, and even preparing for the u.s. -- japan-u.s. trade negotiation
even to give comfort to the agriculture sector. a lot of fiscal money has been spent, and at the same time, a lot of reform pressure has been applied to the agricultural sector. junior koizumi, the son of former prime minister koizumi, has been very active on agricultural reform. a combination of these has been working very well. and general population of japan is supporting japan's open nene. >> thank you. i won't be selfish, so i will open it up now to questions from the audience.
please. ji jim? >> jim zumwalt, peace coalition usa. thank you very much, professor, for that really good tour of japan's trade policy. my question concerns your comment on tpp or cptpp expansion where you mentioned that taiwan's succession would be difficult because of china. my question is, are you saying that china effectively has a veto power or who joins an organization that it is not in, or do you think that japan recognizing that cptpp expansion without taiwan would lead to marginalization of taiwan, and that's not in japan's interests so japan will stand up to this pressur pressure? >> well, ideally we want china to be in tpp. we want both the u.s. and china to be in, in tpp, or in the
future sort of reformed tpp if the u.s. wants to come in in the future, the u.s. may want to demand a bit more. in principle, tpp would be very useful for the u.s. and china. so we want china to be in, so t tpp-11 inviting taiwan first may alienate china, may give another reason for china to be hostile toward tpp, or tpp-11. so that's the reality.
that's not an easy decision, but hopefully in the future when china joins, taiwan will also join. but changing this order can upset china which we don't want to see. >> thank you, thank you, professor. thank you very much for your presentation. you made a brief reference to your graphs where the japan-roc-china trilateral negotiations, the northern collaboration. is that alive, is that going on? where does it fit into rcep and
tpp-11? >> okay, thank you very much. the cjk-fta negotiation has been going on, but negotiators are putting a lot of efforts on rcep. the strategy for japan is after rcep, cjk should be more intensively pursued. and in a deeper way. go deep with rcep will be difficult because of india, because of, you know, other countries like c.l., cambodia, laos, and a few other countries, but on china, japan, korea, they can go deep.
so for rcep, the agreement may be shallow and not so satisfactory from the perspective of economists like myself, for many people, but i think first it will be useful to lock in china into a multilateral agreement, and seek avenue for the next step for cjk. so there china and japan can talk about much deeper issues, soe reform issues, e-commerce international, cross border transfer of data, and so the cjk
would be -- the role of cjk is clearly there. >> thank you. i have a question. for the expansion of tpp, you wrote in the presentation that we have a question whether it is appropriate to call china or uk or eu to be a part of the tpp. just so i can say a question, but i'd like to know your answer. and secondly, can you say -- i'm curious -- how probable would be the case that the eu after --
hypothetically after the hard brexit, so to be a member of the tpp and eu, as well. thank you. well. thank you. >> okay. i answered on taiwan. taiwan should come after china. that would be a very long-term project. chi china, this is a difficult issue. but we can openly invite china to start negotiations on tpp-11. i think that would give a good indication about china's
willingness to change. we should have many ways to induce china to change. through unilateral pressure from the u.s., multilateral process, i think in many ways it would be useful. so, inviting china to tpp-11 would be one of them. but u.s. may not be happy, and this new nafta poison pill clause on market economy. so the u.s. may be concerned. but this is something i want to -- you know, i advocate.
eu -- eu, i am more positive towards inviting eu. discussing enacting tpp-11 and eu. forging a very large fda, mega fda. hopefully this would have some impact on the u.s. trade policy. to induce the u.s. to think about coming back to multilateral arrangement. so i think tpp-11 has a lot of potential. to change china, to change the u.s. and in a positive way. we are not destroying the world.
we are trying to help reconstruct liberal multilateral trading system for the world. i think current tpp-11 members have to start negotiations with several potential member countries. then the brexit, what's going to happen to brexit has to be observed. of course the uk can be a strong member country. strong candidate for membership expansion. and the eu also. so i cannot quite assign
probability. but i hope tpp-11 member countries would consider linking with the eu very, very seriousl seriously. >> professor, maryland meyers, retired foreign service officer. two questions. the first is about the trade deficit with japan. i find it striking that 30 years on from when i was in tokyo, auto exports continue to be sort of the bugaboo in the relationship. the answer then was many japanese companies started to invest here. honda went into ohio, toyota into kentucky. could you tell me at this point in time approximately what percentage of the japanese cars sold in the u.s. market are made
in the u.s. versus made in japan? the second short question is one of your charts showed the difference in projected economic growth if the u.s. was in the tp or without the u.s. being a member. it seems the only country dramatically that had a much bigger economic growth forecast if the u.s. was not in was new zealand. i wonder if you could comment on why that is so. thank you. >> if i understand it correctly, the first question is what percentage of cars made in the u.s. are japanese -- japanese cars made in the u.s. as opposed to made in japan an exported. okay. about, i think, half. half imported from japan.
sorry, half imported from japan, half imported from canada and mexico. i think that's roughly speaking. >> i'll give you a few stats here. 50% roughly that are sold in the u.s., built in the u.s. another 25% or so are built in canada and mexico and imported to the u.s., and the rest, about a quarter, 25% -- >> thank you. >> so you got the answer right. you got an "a" on the exam. >> important facts for this crowd to know. >> thank you. excellent. excellent. what was the second question?
>> the growth would be much greater with the u.s. as a member, i wanted the reason for tha that. >> i can help out. >> okay. okay. yeah. so, somebody wants to help? okay. grea great. >> some of the major concessions japan made on agricultural products are products where the united states, new zealand and australia are all competitive. by removing the united states
from the agreement, particularly japan has some quotas. if the united states does not come pet for that quota, that's a huge advantage for australia and new zealand. i guess that's the reason for the change. >> thank you. >> you get an "a" too. do we have time for one more brief question? i agree with your argument using tpp to encourage china for more reforms, but when we say -- talk about it, tpp includes the rules of state-owned enterprise and
also intellectual property rights, that's our -- usually the issue of our complaint. now you say many of the rules of intellectual property rights are suspended. do you think still tpp is a good tool to encourage china for reform? >> yes, still tpp-11 would be great. about 11 provisions have been suspended with regard to intellectual property. but that's okay. that's okay. making sure that level playing field will be maintained for s.o.e.s.
so, subsidies, and favorable treatment of s.o.e.s should be dismantled under that tpp-11. malaysia made a request for a change. for the petrol s.o.e. but that -- that was the only exception. china may want to ask for exceptions. too many exceptions, you know, cannot be accepted. i think tpp-11 may be better for china than tpp-12 where the u.s. is in. then of course u.s./china confrontation would become the
iss issue. now in the absence of the u.s. china can change. china can show to the u.s. and the rest of the world that china can change. i think that would be useful. of course over how many years change should take place may be the subject matter of negotiations. i think even including that, if china comes to the table of tpp-11 membership expansion, that would provide a productive opportunity for everybody. >> unfortunately our time is up. i really enjoyed this conversation and lecture. please join me in welcoming and thanking professor kawai. >> thank you.
>> thank you very much. appreciate that. we'll make a quick switch over to the final panel. we'll get a couple of waters up here, some new name plates. i did enjoy how the professor got the whole class involved there. that was good. this is a good time to mention a couple things that japan/america society of washington, d.c. does and contributes to the area, inaddition i in addition to this event. there's the cherry blossom festival every spring. also runs the japan bowl. japan language competition for high school students around the region and around the country as well. japan in a suitcase, education
program at elementary schools and other schools in the area. the japanese film festival. there's a range of things that japan america society does here in washington. can we get a couple name plates? >> if you want to become a member -- >> here, i'll give you the microphone. >> you did a great job. >> abigail is the one to see for membership. of course japanese language instruction. i'm standing in front. my effort to be a good citizen is preventing us from moving on. i'll invite our second panel to join. this will be moderated by matt goodman, he is back with us. he'll introduce the panelists.
up. i'll get started. welcome back, or if you were here for kawai son's presentation, we're carrying on. i'm matthew goodman, chairman of the japan america society of washington, d.c. delighted to have you with us again if you were not here first thing this morning. i understand we had a good discussion on the domestic panel. this is the international panel. we will talk about japanese foreign policy, u.s./japan appliance, issues in the pacific region and anything else that our panelists decide that is interesting or that you want to ask about. for the next hour and a half. so we'll go until 3:30, then we'll conclude. so, i have a great panel here. i think these people are well known to this audience. i'll move down the line from my left to your right. we have the japan fellow from the woodrow wilson centers, asia
program. also professor in the policy management faculty in tokyo, and he is an adjunct fellow at the japan institute for international affairs. he focuses on american politics, foreign policy, and international relations. and he's well known to this audience as a real pro, an expert in the issues we'll be talking about today. next to him is a colleague at the woodrow wilson center. we're not deliberately here tilting the field towards the woodrow wilson center. she is senior northeast asia associate there. she is an expert on japan, korea, taiwan, northeast asia broadly. she was a journalist for a decade with an emphases on asian markets. she has done a diverse set of
work in political economy. my home area as well so we have got a lot in common. a lot to talk about. delighted to have you with us. at the end is eric atback. he is a former u.s. official at the white house. he was my predecessor and successor at the white house, which is a neat trick, if you can pull that off. so delighted to have eric with us. he's an expert on japan. he did a lot of work on china and taiwan at ustr and kovers tho covers those parts of the world. we have a great group here, tilted a little towards economic issues. i will try to broadly divide the conversation into economic and
other issues. but they're going to blend do together in peoples initials remarks. what i thought we would do is ask maybe -- if we turn off our phones up here. that may be disturbing the signal. i'll do that as well. i'll ask professor knack ynakay start, what is facing japan and what will abe's priorities be this year. >> a bit different subject that we talked about on this morning, about the name of the area. you focussed on this newness and freshness, but i think it's more about calm and peace. it started out as a bubble. it burst. we had march 11th.
i think something that symbolizes peace and calm would be -- >> peace and calm. >> right. this is very important for japan. how this name of the era, how it penetrates the japanese vernacular. like when i'm at a university, i will be labeled as a very old -- there's some students there. they would make fun of me. now that i can make fun of the , and this is sort of like a spiritual -- it's not psychological, it's more spiritual rebirth. so i think it's some bymbolical important in looking at 2019. secondly i found out an interesting poll on -- it says that, you know what is japan's strength? it says technology is at the highest, near 80%. but if you look at the lower
end, it's language, politics, diplomacy, military insecurities. they're all under 10%. that's a tough number, i think. so we have to sort of keep that in mind. then sort of jumping into the topic i was given, japan foreign policy, u.s. and japan. i think we're extremely lucky that we had prime minister abe as our leader in these rocky times. prior to prime minister abe, i was sort of made fun of by my american friends as japan being a failed state, right? politically. because we're having this leadership change almost every year for five, six years. the professor emphasized that. his initiative on national
security infrastructure. the fact that he came out with the national security strategy is important. because drafting a national security strategy is an effort to -- it's a narrative to shape the desirable kind that you want in a region. japan was never known for this shaping attitude. but now we have this fort. and others have conceptual framework that defines japan's foreign policy. that's based on institutional change that prime minister abe y undertook. so we're extremely lucky that we had prime minister abe. my role here is not just to praise him. so i guess i should be -- >> it's not to bury him either. >> not to bury him either. japan is expected to play a role of upholding international order
with some others. but in asia-pacific almost alone. japan is seen as a guardian. maybe on the economic front, to a certain extent i think it has a rational. but when it comes to political, security, and especially on the human rights front, it will be difficult for japan to take that role of the guardian of international liberal holder. we should be cautious about relying too much on japan. on the state of the u.s./japan relationship. i think it's like a double edged sword. for japan there's no other options. if we think about the fact that we're facing a rising china, a threat on the korean peninsula, we have no other options but to sort of beef up and double down on the u.s./japan security alliance, no matter who the
president is. you chose it we deal with him, no matter who. it's not our fault. you can't criticize japan for being friendly with any administration. that's the basic position. but that doesn't mean that we are not -- so on the afratrade front, we are nervous about it. starting with the negotiations this year, about u.s./japan trade talks. and this general mood. sheila touched on it in the opening. the sense of rising refren retrenchment. why does the u.s. have to be there? if you talk to the washington foreign policy establishment types, you're worrying too much. america is always there. it's a resident power.
but you see this retrenchment not just on the republican side but on the democratic side as well. i don't say it's a consensus. i may be overreacting a bit. but we see that because the u.s. is the only option we have at the moment. you can't criticize us for being too worried about it. and there is a consensus in japan that, you know, we have to sort of double down on the alliance. if you ask the japanese public do you support the alliance, people will answer like 90% in support. 90% is not a number that you usually get in a democracy. so it's a very strong support. but i think the content of that support is changing a little bit. because there are doubts in japan, like i said, about u.s. commitment to the region, whether you will be a resident power in the region.
so i call that, like, the shogun mentality within the support base, which is increasing. so we -- though japan is among the major western nations. japan is the most comfortable nation with president trump and his team. i think this notion has u.s. is potentially an epicenter of world uncertainty and instability is having a big psychological effect on japanese. and i think in particular to the younger generation. it's having a strong impact on them. so we're not hedging, but searching for other partners. like in australia, india, we're inviting uk to our region. they're feeling a bit lonely
now. you know, they're willing to partner up with us. france, we have this two plus two dialogue with france. that would not take place with the role that u.s./japan alliance is playing. indian navy would never come to east china sea and deal with the situation that might arise. there's also this theory that japan -- even japan is hedging. look at prime minister abe going to china. probably xi jinping is going to visit japan sometime this spring or maybe a bit later. but i don't buy that argument because, you know, japan/china relations, prc relations in the past ten years was really bad. like minus ten. so this effort is just bringing
up to minus one or zero. so i don't think you should trait it as japan hedging because even japan can't trust the u.s. we took sides. i think that's the correct depiction. with rok, it's extremely difficult. we used to call our relations with -- or how we see south korea as being we're two tired. korean fatigue was the key word in trying to explain how we approached south korea. but now some of my colleagues, who are not like the typical anti-korean types would say distrust. they don't want to talk about it. there's no use. so that kind of mentality is increasing, and i'm extremely worried. this is not just because of the
history issues, i think. history issue has never been purely about history issues. it was always more than that. so there was a strategic sort of understanding that if you look at the future of korea's position in east asia, which is important, japan or china? we feel that they see china as playing a more important role in the future. with -- between u.s. and china, koreans think they can balance between the two. if it's china and japan, it's china. that's the kind of -- i don't know whether this analysis is correct or not. but that's the kind of feeling that is rising in japan. i'm going over time a bit, so i'll quit. so the state of the alliance is, i think, okay. quite good. maybe among the policy people,
even better during the obama administration. that's the exception. no one thinks that way around the world, but yes pan does. the appliance is in a better state than during the obama administration. but this alliance doesn't exist in a vacuum, it only functions when the u.s. has an east asian policy, which we don't quite see. yes, the alliance is okay, but it doesn't exist in a vacuum, so i'm not extremely comfortable or optimistic about, you know, how alliances would kick in when it needs to function. to deal with a situation. your election is coming back. japan is known to be the 51st
state. it's maybe the most reddest state among the 51. i'm joking a bit. but, you know, this time around there's a high probability that it may flip. the new and incoming democrats are not totally new, but many of them are so new an we don't have the connection to them. so i think it's not too early for us to establish connection with them, understand their thinking, where they're trying to go. so i would like to emphasize to the embassy here and the japanese businesses to try cultivating the new networks among the up and rising democrats who have just joined congress. i'll end with that. thank you. >> great. thank you. i have a couple of questions already to ask you, but i will let some more opening remarks to
happen. whatever you're interest the in presenting, i'm happy to hear. >> thank you, matt. so, looking ahead, 2019, the real challenge for japan will can it be a stabilizer in global uncertainty. i wanted to take my five, ten minutes to talk about the political economy. especially regarding the impact of the u.s./china trade pact spills over into the global political economy. we have already heard today about the risks facing not just the united states and china a trade war, but to the global economy at large. but there is -- if there is a silver lining to this conflict, it is that it has led to a cooling of relations between japan and china. at the same time what japan is
doing at the moment is having a two-pronged approach to dealing with this trade war. the first approach is to side with the united states against china. really trying to encourage china to abide by the norms of the international community, by adhering to the rules of the wto and being a part of a multilateral approach and ensuring rules that have been key for growth in the -- in the post-war era continue to flourish. that has led japan to join forces with the united states, as well as the european union and the wto in taking action against not china per se but against non-market economies in making sure they adhere to
transparent rules, that there is restriction and ability to combat forced technology transfers, protection of intellectual property riteghts, regulation of state-owned enterprises. that comes at a time where japan is also taking another second approach. that is to say a more conciliatory approach with china as professor knack yanakayama m, there's been a thawing of relations, but the challenge is to have a decoupling. a decoupling of economic interests and trade relations with china on one hand and also acknowledging and trying to come to terms with the political as
well as the strategic rivalries that it has with beijing. i should point out that the relations that beijing and tokyo now have go beyond the cosmetic. it is not simply a summit diplomacy in october for the sake of summit diplomacy, and instead of just having another meeting in spring this year in tokyo, there is great commitment between the second and their largest economies in the world to have what prime minister abe has called moving from competition to cooperation. this is not an altruistic issue, it's something that both countries see as critical. in part to offset some of the risks that is being imposed by a more unilateral trade approach by the united states. we've seen an agreement between beijing and tokyo to have an
easing of maritime tensions. we've seen specific road map for joint energy development projects. we've seen a commitment to third party country cooperation especially in thailand for smart city growth. the relations with china have already started at a low point. the fundamental rivalries that have -- the rivalries and quite frankly the mistrust continue to persist. if we look at a poll done by gimbel at the time of the xi/abe summit, we found that china's public sentiment on japan has
improved remarkably from the nader of bad relations of china and japan and the islands in 2012, about 20% of the chinese have a favorable view of japan. that comes in part from greater tourism and more chinese people going to japan and seeing firsthand what japan has to offer. it has a great deal to do with a more positive tone in the chinese state media coverage over the last year or so. but what's interesting is that whilst we've seen a dramatic rise in a favorable impression by the chinese, the japanese still continue to have an unfavorable view, according to gimbel. nearly 90% say they have an
unfavorable view of china. why is that? one of the biggest reasons the japanese say they have great distrust with china is they see china as a selfish power. selfish power that is to say it's not committed to the global goods. that it's not an active contributor to the international community. and that it is more that the china dream is more about imposing chinese will and china's own standards rather than trying to have a more conciliatory, collaborative relationship with the world at large, but especially amongst asian nations. there is also mistrust in the japanese public about the governance system of china and the one-party rule of china as
well. this is actually precisely where japan can actually play a considerable role in being an advocate, a leader in the international liberal order, that it does have an inherent interest and commitment to international organizations and adhering to the rule of law. we have seen japan taking a greater responsibility for this since the a recent of the trump administration. certainly we heard today about expectations for folk yo tokyo from everything from hosting the next g20 meeting with a global agenda to enhance the ctpp and expanding membership for ctpp. but that's not enough for japan
to be really -- to take on the mantle of the global stabilizer. it's not enough to execute carefully and thoughtfully the plans that are already in the making. it needs to do much more to offset the insularities that we're seeing in washington and expansion ambitions of china. that is really because we're also seeing a seismic shift in global growth, and global growth trends. that comes from the challenge of the digital global economy. we already see that issues like automation and artificial intelligence can disrupt the labor force. it has led to a lot of fear, a lot of wariness. a lot of uncertainty an anxiety
in the work force at all levels. and it's contributed to a rise in nationalism and especially economic nationalism. one of the issues that will be critical for a country or countries to take leadership in is on data and privacy. data will be really the defining power and lead to power struggles in the future, as any natural resource like oil, like air pollution right now as might have had in the past, and it will probably be a bigger source of friction in this year and the years looking ahead. at the same time what we need to note is that there are clearly different ideas about data privacy. just how valuable data can be.
we're seeing differences among like-minded countries like the united states and the european union. this week we've seen france imposing a fine of almost $60 million on google for violating some of the eu's privacy an data laws. those kinds of frictions at a corporate level will probably increase at the national level and may impact public policy debate moving forward. there's clearly a divide in how china perceives privacy and how japan perceives privacy. this is an opportunity for japan to take the helm on that. we talked today expensively about tpp and its reincarnations, the ctpp as a force to bring countries together, like-minded countries
at different levels of economic development. it is also an opportunity -- it could be an opportunity also to ensure that e-commerce and the service sector side rules are adhered to as well. what we will see, if we're to talk about the future and the immediate future, we see for instance a gathering of global leaders. and business executives at davos this week. as you may recall, two years ago it was xi jinping who took to the stage an made a great deal of news talking about the need for the international order to come together. there needs to be a working towards a common good. that kind of debate and
discussion was met with great cynicism by the participants of davos. at the same time it did raise an issue as to -- on the one hand, those issues are important. on the other hand, with the retreat of the united states an a greater reluctance of the united states to take on the leadership role in economic architecture, who can actually take on that role? prime minister abe will be giving a presentation later this week at davos. we've already heard today that there's a lot of excitement and expectation as to what prime minister abe may or may not say. certainly there is a great deal of hunger for him to take on a greater role. to talk about interests of global goods. and within that i think the issue of data and privacy should
really take on a higher level of importance. thank you. >> great. you've introduced some important issues with respect to china particular. and i want to come back on a couple of those. let me bring eric into the conversation. eric, you're following the trade issues. i'm happy to have you again talk about whatever interests you. >> thanks very much. pleasure to join the conversation. i have the problem that you always do if you're the last speaker, everything interesting has already been said. including by kawai earlier during his presentation. in terms of looking at the year ahead, 2019 and the challenge facing prime minister abe, just to pick up on a lot of the policy agenda that stands before
him, if you look at how he has navigated the first two years of the trump administration and advanced japan's economic interests broadly construed in the context of all the chaos and uncertainty about the global trading system and the relationship with the u.s., he's done a very commendable job both in terms of building a positive relationship with president trump, deflecting and sort of moderating u.s. demands for concessions that would address the trade deficit, which this administration is so obsessed with. but he's also done yoman's work in exercising leadership in the region, particularly with getting tpp-11 over the finish line, and the absence of u.s. participation being a
constructive force at the wto and working with the eu and others on wto reform. concluding an fta with the eu that will also provide another sort of example of the possibilities of trade liberalizing cooperative activity in the global system. even in spite of this protectionist moment that we're living in. he's accomplished a lot during this challenging period. but we're entering an even more difficult time ahead with global growth slowing, a lot of uncertainty about china's economic trajectory. that is worsened substantially by the extremely yun certificun outlook for the u.s./china trade talks which we heard unfortunate
news today apparently about the trump administration refusing to welcome the vice minuisterial delegation to talk about terms and conditions. potentially high-level talks at the end of this month. so that remains a huge risk factor for the global economy, and one that impacts japanese economic interests substantially but one that abe and most of the international community can have very little to do to get a positive outcome. in that context, what is abe to do? he has taken on a new challenge now with launching -- agreeing to launch the bilateral trade negotiati negotiations that are variously
referred to as trade agreement in goods or u.s./japan trade agreement. so clearly there are some substantial gaps between the understandings and aspirations of the u.s. and japan an this is going to be a real challenge for him. there are questions as to whether the trump administration is prepared to adhere to the agreement that was laid out in the joint statement that this negotiation will be primarily focused on the goods side and particularly in agricultural organization the tpp -- there is tremendous ambiguity about services and other issues in this negotiation. a phased negotiation with agreements reached on a rolling basis, potentially with early harvests or will this be kind of an intractable challenging
negotiation because of the different visions of the two sides. as we discussed in an earlier panel, japan's political domestic calendar between now and july is very challenging for abe to even give any initial signals as to what japan might be prepared to provide in the negotiations. of course the shutdown is not helping on the u.s. side in terms of preparations. other than that, everything is going great on the bilateral side. and i listened with great interest to i think relatively positive assessment of potential to conclude the rcep agreement this year. and i think there are certainly a lot of motivations on the chinese side to get momentum
moving. i understand that japan has begun to be more comfortable with perhaps a lower level of ambition as developed country participants. i think we are never fail to give india the credit it is due as being among the difficult trading partners in the world in terms of what they will demand, and whether it will be possible to exceed to it an treat them as a least developed country -- even that may not be enough to guarantee the end games providing their necessary levels of commitments to get a possible agreement through. i think rcep will be a boulder to push up the hill before the end of the year.
the other x factor is what is the u.s. perspective? i think the trump administration has had the opportunity to remain relatively quiet on the benefits or dangers posed by rcep, if it gets closer to being real. i think that becomes a more difficult thing for the trump administration to accept. and we should expect the kind of subtle diplomacy and messaging coming out of the white house if we see a development we don't like on that front. i think there's some real hurdles to be overcome for abe to play the kind of leadership role, advance japan's interests and contribute to stabilize iin
the global rules based trading system. particularly the case with the wto, where we are in the midst of a long descent into chaos. there will no longer be a quorum to hear cases. there have been proposals. some constructive. i don't see any of them acceptable to the u.s. at this point. japan could become more involved and work closely with the eu and others to try and reach a solution that would be acceptable to the united states. it remains a very dangerous situation. with the multilateral trade liberalizing agenda of the wto basically collapsing if the dispute settlement process also
completely fails and is no longer able to hear cases, i think that's incredibly worrying for the rules-based system, and something that japan as one of the leading supporters will have to figure out what it can do to be kruk tif. this is appalachian example in the an example of in the absence of u.s. leadership and crafting a solution, the ends may be insufficient to get to the ends we want. with that little dose of sunshine, i'll stop there. >> we have -- i have a long list of things i want to try to cover. it will be difficult to do this in 20 minutes before i turn it over to the audience. it's tempting to get into the deeper structural questions like
explaining why this red state a phenomenon in japan -- many data points seem to suggest we're better off with democratic administrations, that's not a political statement, that's just an observation going back to the nixon shocks that a lot of problems japan has had in the alliance have been under republican review. let's zero in to a couple things that were not mentioned and that are in the news this week. that includes russia. prime minister abe is in russia as we speak. there is talk of a -- some sort of peace treaty with respect to the four islands.
do you predict there will be a major break through in russia this year? what are the implications of that for the u.s. japan alliance in particular? >> i don't see any settlement. if you read the papers, talk to anybody, nobody understands why prime minister abe seems to be confident about reaching some sort of deal. russia is not a trusted sort of country in japan as well. you have north korea, china, then it's like russia. i don't understand. it's different from what mr. trump -- how mr. trump trusts putin, i guess. but somehow prime minister abe trusts putin. i think they have met 25 times.
that's a lot, right? i don't -- simply i don't see the logic. i don't see any break through happening. so the answer, what kind of implication it would have on u. u.s. -- i don't see any. >> let me put another one on the table. north korea. you talked about south korea, that's an important issue, that relationship what about north korea? what are the risks for abe son with respect to north korea? there's a group in sweden right now, i understand they're trying to negotiate on the abductityab and president trump is moving ahead with his summit, in hanoi -- not sure that's been confirmed. what are the risks for abe son and how he will handle that? >> according to government officials we are supposed to be fully informed of what's happening. some of our high-ranking
diplomats are always around the meeting. getting briefed by the u.s. officials. that's the calm down is what we hear. but i think we are extremely worried. no one on the u.s. side do not completely understand what's going on. so even the high ranking briefing by the u.s. official to the japanese high ranking official doesn't fully convince us. the short-range and mid-range missiles maybe not on the deal. there are some issues that -- like the abduction issue that we're very much interested in. although, the public is not as emotionally attached to the issue as a couple of years ago. but still, it's a big issue. and the biggest fear is u.s.
forces in rok. the kind of deal that president trump might sort of make with kim jong-un. i don't think that's going to happen. but he has been hinting that consistently. so maybe not now, but sort of in the future sort of arrangement. if that comes up, that would worry us a lot. but i think if that happens, that will be a revolt on the u.s. side as well. i was quite shocked at the reaction of the republicans when mr. trump said he is going to retreat from syria. many of them were quiet on the domestic issues. but many came out publically in saying we cannot -- that might happen -- this is just hypothetical. if mcmaster, kelly and tillerson come out publically and say that we're against the president's
decision and if it somehow out of a sense of duty revealed what was going on in the white house that would be a big blow to the trump plan. i veered off from your question. >> there's a lot more to say about either of those topics. you are welcome to jump in on either of those if you would like. let me ask you about the china story that you raised and the notion of this more conciliatory approach by abe. to what extent -- you touched on this, but i want to press again on how much of this is a strategic play because china/japan relations are fundamental for japan and there's some longer term play that abe is doing. how much is more tactical, either because it's a hedge against the u.s. or because xi is reaching out or because -- i heard a story that abe's objective is to make sure xi
comes to the olympics in 2020. he will be nice to him until then. after that, it's back to the normal spatting. seriously, is this just tactical or reactive, or is there some deep of kind of play here by abe? before i get to the china issue, if i could add my two cents on the north korea issue. japan still remains the only major country that does not, in the neighbor, that has not had a summit meeting with kim jong-un. one of the remarkable developments of 2018 was that north korea goes from the pariah state to the darling and japan has really had to scramble to readjust its position. the understanding now is that abe would be open to a meeting with kim jong-un. that interest is not really --
it will continue to be something tokyo will be focused on. in the meantime, there isn't a party that is able to carry japan's interests. regarding north korea and japan's interests are major concerns for regional stability and lack of clarity about what exactly denuclearization is, what the time line is. but at the same time, a lot of hy hypothetical talk about reconciliation, potential reunification, what kind of economic assistance there could be. there is already pressure for japan to actually contribute to those kind of reconstruction efforts. it's in a quagmire. i think the situation really remains very much in flux. on the china issue, again, this
is -- we're starting from a threshold of negative -- negative threshold going to positive. we're going from a relationship acrimonious to something that is within the realm of acceptability in the region. one of the reasons, of course, is the two sides have shared economic interests and shared economic concerns about the fallout from the persisting u.s. trade policy. but at the same time, even if there wasn't a trade dispute, such a major trade dispute and threat of terror from the united states, china, again, we're facing a considerable slow. >> dale: dodown in the champioi
company. that will be a burden on the chinese leadership and the -- china is not simply reaching out to japan. it's also reaching out to india and other countries as well. we will see this charm did diplomacy. my concern is this continued divide in public sentiment between japan and china and how that can actually be reconciled. if i can add one anecdotal information. i was in new delhi last week for a conference that was organized in part by the indian foreign ministry. at one of the conference -- one panel discussions was actually
about the security regime. the panelists were actually the admirals -- the quad, japan, united states, australia, india. the moderator was british. there was participation from a french admiral as well. as you can probably imagine in a public forum in india, none of them were going to go out of their way to say anything controversial. at the same time, it was clear that they wanted to present this unified position, speak with one voice. what was that one voice? that one voice was to talk about the threat of china and the rise of china and the need for the quad to actually cooperate together to take a position against beijing. that is going to be the challenge going back to what i said at the beginning.
to what extent will japan de-couple from china. while continuing to view china as not just a strategic rival but as a military threat as well. >> eric, just simply prediction. is there going to be a u.s./japan trade, bbanana, whatever you want to call it, this year? yes or no question. and then how does that -- your judgment on that affect the ability of the u.s. and japan to positively or negatively work on other things in, first of all, the trade and economic realm, whether it's the trilateral work on the eu with the agenda or
broader things in the alliance that they could be working on other than this, which is going to take a lot of time. first, is there going to be a deal or not? >> well, i guess -- >> that's not yes or not. >> the odds of an agreement of some kind that the trump administration will claim as a victory by the end of the year are decent. whether that is a comprehensive free trade agreement, i would say the odds of that are zero. but it really depends, as do all of the negotiations, first and foremost, what does the trump administration really want? the trump administration set up the nafta renegotiation as if it was going to be a de novo entirely new agreement that would fix all of the ill-defined
problems of nafta and render our trade balances even with canada and mexico. in the end, what you got was a tpp gloss on the existing agreement with some additional protectionist elements in the auto sector. so very far from what was originally promised, in part, because i think the trump administration came to understand the depths of the resistance it was getting from virtually all u.s. economic con st constituencies. i think the north korean -- the need to maintain positive relationships with korea in the face of the challenge of north korea i think was also a moderating factor and the desire not to take it back to the hill under tpa. just a really modest, frankly,
meaningless renegotiation of that agreement. the question is, is that going to happen with japan? is it going to be kind of just getting the things that we would have gotten under tpp but lost out because of our incredibly bad decision to pull out? or are we going to upset the apple cart and really put the screws to abe and the japanese u using the threat of auto tariffs to get greater liberalization and to impose some kind of managed trade in the auto sector, which is what it would take really to make a dent in the bilateral trade deficit. the answer is, really don't know what the trump administration's bottom line is. if they are prepared to be reasonable, if they are prepared to have a phased series of agreements that are within the
political space that abe has available at the moment, you could certainly get the first of these agreement by the end of the year. >> do you think there's going to be a trade deal this year? how does it affect the ability -- >> if i could really make -- >> you are on this panel. you are supposed to predict. take a wild guess. [ no audio ] >> it was only until last autumn, japan really made public it had no interest in having a b bilateral deal with the united
states, but it wanted to bring the united states back into the fold of tpp and pursue a multilateral approach to doing -- getting to a deal. that has been overturned. so it's pursuing this bilateral agreement with the united states. in light of the current -- i don't want to say instability. japan would be smart to take advantage of the fact that the united states is pursuing trade deals on multiple fronts with a lot of restrictions, some of them self-imposed. to have this delay tactic -- it can overcome 2019, we're going into an election year. so it will be each more difficult to have a trade deal in place.
i would think that that would be the strategy that would be -- make the most sense. >> since you can address that. but i also wanted to ask you, is this trade issue a bigger threat to the u.s./japan alliance in 2019 than something else, the possibility of a fallout over any of the issues we have discussed, north korea or russia or some problem in okinawa or just the absence of jim mattis or something else that could destabilize the alliance? what's the biggest risk to the alliance this year? >> simply put, the biggest crisis that japan can face is the u.s./japan relations crumbling down. china is a problem. the whole point about u.s./japan alliance and the relations is to deal with those situations.
we know that is out there. if that space is the root, the rock part, solid part, would crumble down, that would be the biggest crisis for japan. what's the potential dangers in managing the u.s./japan relations? it's trade. i think it is huge. i think prime minister abe and his team understands that. first of all, the best that the japanese bureaucracy is good at is the delaying tactic. i guess the u.s. side understands that. we think that part is kind of over. so we have announced that we are buying 100 more additional f-35. yes, we do need them. is it really f-35s? people are being quiet, silent because we kind of know what that's about.
as long as u.s./china negotiations is not settled, i think usdr is not fully in position to deal with japan. it seems like it is going on. when the election season comes in, things would slow down on the u.s. side. not a delaying tactic. that part is over. trying to slow down, do other things, i think that's how we're going to sort of -- the last point. if we have to do it, i think the abe administration -- that may ignite a fuse. >> i'm going to bring the audience in. before i do, think of your questions.
let me just ask one final question at least in my mind links economic and strategic, which is whether there is a tension between japan's more n conciliatory approach, the interest in working together to find projects, which is part of the warming of the two countries, between that and the best japan interest which in the u.s. case seems to focus on pushing back against belt and road or offering an alternative in terms of the content. there isn't a lot else at the moment other than trying to find some alternative to bell and road. is there any tension there for anybody down the line? >> we're going to do both. be tough and try to cooperate with china at the same time.
managing that is, i think, the toughest task that japanese did i diplomacy has at the moment. we were urging u.s. to be tough on china. the situation is be careful what you wish for. you might get t. you see this discourse or narrative rising in we're on the u.s. side. but calm down the situation. but we have to be tough on china. that's the delicate position. >> i agree that japan has to do both insofar as it has to be part. it is on a project by project basis opportunities on belt and
road as well as the pacific. there is a huge infrastructure investment gap that even if both plans were to materialize, that still wouldn't meet the gap that is needed in asia as well as in latin america and africa. japan remains a powerhouse in investments in latin america and asia. it will provide quality financing. that kind of quality over quantity will really continue to define japan's aid effectiveness. that will be -- should be the -- >> i think the japanese strategy is very sensible. they have been more enthusiastic
about the indopacific. i think the true incentive of the japanese government is to avoid creating problems in the china or u.s. relationships. they view collaboration on infrastructure projects either under the indopacific or the belt and ready as highly problematic. there's less that meets the eye in terms of japan's collaboration. they will probably go on in the indopacific. even though it lacks substance. because of the serious problems of actually doing collaboration with china on many of the projects, so many of this have moved into problems with recipient governments. i think they're being positive but cautious and balancing it
pretty well. >> i'm going to ask folks, if you have a question raise your hand. a microphone will be brought to you. right up here in the front. then way in the back after that. >> my question is u.s./japan trade -- that bilateral trade negotiation. related to the keynote speech. looking at the agreement among the u.s., japan and canada, one of the rules is it tries to prevent any country from concluding a trade agreement with china. you can guess -- u.s. may raise the same demand to japan during
bilateral trade negotiation. if this happens, it will make it not work. it will make it impossible to expand tpp into china. how do you think should japan try to lodge that kind of demand from the u.s.? >> the poison pill provision. agree with the premise that they are going to ask japan to adopt something like that. how does japan respond? >> yeah. i think this is a great example of the trump administration laying out an extremely tough policy demand that the canadians and mexicans clearly didn't care that much about. they had bigger fish to fry in
getting that agreement done and avoiding the disaster that it would pose if nafta collapsed. this is potentially quite problematic with japan. whether the u.s. is prepared to put abe in that kind of a difficult position in addition to all the sensitivities involved in the negotiation beyond that is a great question. whether the u.s. thinking it can make all of its trading partners choose between deepening economic ties with the u.s. and freezing them with china, that historically has been something that nobody in the region wants the u.s. to do. there's no reason to think they are more enthusiastic about the u.s. demand now, particularly given how utterly unreliable we are. that to me sounds like picking a fight that is not in our
interest. or in japan's interest. if we don't make that demand, if the u.s. doesn't make that demand, people will say why is it in usmca and no the japan agreement. i think it's a guy gigantic headache. it's another reason the negotiation will be a complete nightmare. >> can i just add? it doesn't say china, per se. it's non-market economy. one way that skirt this issue could be to define a non-market economy, perhaps non-market economy in transition. i completely agree. it's a tremendous problem.
japan will -- ought to do its utmost to avoid having this cause in. another way to avoid it impacting our stuff is to say in negotiating with non-market economies moving forward, that existing current negotiations won't be impacted. it does more harm than good in forging alliances. >> thanks. there was a hand in the back. please identify yourself. >> hi. thank you. i'm john from radio free asia. despite the second summit about
the fully denuclearization is going to be a long way and they are skeptical at this time. maybe a couple things could be agr agrees. u.s. and north korea, dismantling the icbm. that one is not enough for the japanese government. short-range and middle-range missile is still japan now. i want to ask you, what japanese government can ask to the trump administration to maximize japanese on national interest. >> well, i guess we would have to ask the trump negotiation team to be tough on north korea.
include short and mid-range missiles in the negotiations. although, the term maximum effort is almost gone. we have to keep on emphasizing putting pressure to a certain degree. if it all doesn't work out, we would have to do the negotiation ourself, i guess. short and mid-range missiles are not a direct threat to the united states. of course that would shake japanese trust towards the u.s. to a certain degree. we would have to take care of the situation ourself. i think in order to do that, there is a willingness on the japanese side and the leadership that has to be some kind of
direct talks with the north korean side. in order to prepare for that situation. that's the only way to go, i think. >> this say panel on foreign policy. i'm curious what you can tell us about japanese policy towards some contested parts of the world. for example, the arab, israeli, palestinian dispute. is japan really trying to stay away from saying very much? is it working behind the scenes? i'm curious what impact the shifts in policies in some of the areas have on japanese diplomacy. >> that's a good question. we focused a lot on not just today but in the last couple of years in looking at abe's foreign policy on the
indopacific region. what about the other challenges in the world? if japan is going to play more of an assertive role, these are important issues. is it interested? is it involved? >> i don't know if i have the expertise to fully answer to your question. although japan is not a superpower, we would like to see ourselves as a country with a global scope, interested in various issues. so i said that we double down on the trumpe ed administration. but we're a strong supporter of paris agreement. we're not a member of jcpoa, we support that. we are interested in maintaining the global norms. i'm sure the embassy won't like
i'm saying this. i wasn't particularly in favor of japan with withdrawing from the iwc. i will say that quiet. if you don't like it, just pull out. i don't think that was right. there are political reasons for that. all the countries have those issues. putting that aside, i think we are very much interested in playing the role of -- you used the word stabilizer. the region we're living in is so dynamic and dangerous. honestly speaking, i think we are preoccupied with our region. actually, japan doing something. when there was talk about peace and security legislation in 2012 '13, there was many elements,
according to the recommendation, there were lots of mentioning about japan playing a more bigger role in collective security, in u.s. operations. that sort of faded out. we live there a tough region. we have to take care of o ourselves first. that mentality is surely there. in on strakt, we're interested in becoming a country with a global scope. that doesn't necessarily mean that we play an active role in condemning the saudi for the khashoggi murder. the prime minister announces it in the unga every year. the prospect is getting dimmer. because i still think the phrase that was coined, global civilian
power, is, i think the right model that japan should pursue. that doesn't mean we're not going to focus on security and all that. the kind of image that we have of ourselves -- i think the term global civilian power, although it's old, i think it still fits. becoming a member of the u.n. fits into that. we're still pursuing that. the momentum is itself -- >> in championing that. okay. i should mention, if i missed it, that japan is hosting its fifth or sixth meeting, the africa conference this year, one of the many summits this year. it does, on issues that are more
distant than its immediate neighbor, try to play a role. on those issues i don't see as much involvement. other questions? yes, ma'am. there may be one baltimore after that. we should probably wrap up. >> just a question. the taiwan government has been expressing the will to join ctppt. what does taiwan have to do to obtain other support, especially japan? >> let me ask eric to answer that question. if i can add a part b to the question. is it time for the u.s. to consider eye bilateral -- it probably can't be called an agreement with taiwan.aeye bila probably can't be called an agreement with taiwan.ye bilate probably can't be called an agreement with taiwan.e bilater probably can't be called an agreement with taiwan. bilatera probably can't be called an agreement with taiwan. >> since the first question
wasn't hard enough, you had to make it ten type times as hard. on taiwan's interest in tpp, i think the problem is that china is willing to invest considerable political and diplomatic resources to deturi g i -- the u.s. is no longer part of the process. i think china would pull out all the stops to get tpp members to understand that china would seek to punish champions of taiwan's inclusion. i think we should expect that. maybe aly model, if you think about apec membership and other things, would be a
kind of joint entry, china and taiwan entering tpp at the same time is one potential way of coming at the problem and limiting the blowbac back. obviously, that dislay delays prospect substantially. i hope i'm wrong about that. i'm not sure members want to deal with the blow back from the chinese on that. maybe they will be prepared to do that. on the u.s./taiwan fta or economic agreement side. there's a bandwidth question, given the trump administration's willingness to create problems within the u.s./china
relationship, it ought to be a more permissive environment to explore the possibility of a y bilateral trade agreement. we have the agricultural stumbling blocks. including beef and pork. i think taiwan would need to make a strong case and have strong allies. particularly in the egg commu-- community in the u.s. i think it would be well worth trying and i think taiwan should bring an ambitious package to the table to see if the trump administration would be willing to take it up. >> can i add to the taiwan question? i was in taipei in december.
what struck me was not only at meetings at the trade and economic ministries but also at the national security council at all levels, there's this issue of the national taiwan interest to join cptpp and to have a bilateral trade agreement with the united states, that it's more than an economic interest. it's a security necessity as well. that said, this is something that's going to be negotiated on a trade ministry basis. while taiwan's position in the international arena has become increasingly challenging over the last year or so, the negotiators are going to be focused on the economic issues. as eric said, some of the issues
that remain sticking points in this remain unchanged, not just from the trump administration, but during the obama administration and before that. so while there is recognition of taiwan's interest to pursue this, it will be difficult, unless taiwan is able to give significant concessions on pork in particular. i'm not sure whether that kind of interest has pressed on the taiw taiwanese side. one thing that could help taiwan is whether or not there is a final deal or not, a formal expression of both sides, both the united states and taiwan to have some kind of trade -- formalized trade deal would help taiwan in raising its stake and
its foothold in the international arena. that could be one step that it could pursue in the future. >> we're out of time. i'm going to ask one more quick question to everybody on the panel. we mentioned the g-20. rugby world cup, to which point will japan's team reach? will it win? will it get to the final? will it get to the semifinal, quarterfinal? go. >> there are some hopes. we don't know whether we will win. we're in a position that we can compete. >> quarterfinal, semifinal? >> finals. >> all right. we have a prediction. nibble else wa anybody else want to stick their next out?
>> i'm very -- i am a fan of the rugby team. i'm a fan of the japanese rugby team. i know nothing about the rules. i don't know how you win. definitely the semifinals, because -- just because. >> eric, want to stick your neck out? >> a fan all the way. >> there we go. >> we will invite you back next year. we will check on that prediction among the others. terrific panel. thank you so much. join me in thanking the panel. [ applause ] >> thanks to the carnegie
endowment. we appreciate your support and attention. thanks so much. >> thank you. i couldn't say it better myself. i will leave it there. thanks to all of you for coming out. this concludes japan in 2019. it has been a full day. very productive day. that's thanks to our panelists and speakers and to your participation as well. thank you very much. [ applause ]
the house and senate are back in session today. this week, the senate will work on a proposal made by president trump on border wall funding and daca. the house is expected to take up several bills to reopen the government this week. coming up here, a discussion on iraq's government and iran's efforts to influence its officials as well as the country's political, economic, security and religious leaders. live coverage starts at 4:00 p.m. eastern. the house rules committee will meet to consider one of the spending bills that provides funding to reopen several federal agencies. that that's live at 5:00 p.m. eastern. c-span, where history unfolds daily. in 1979, c-span was created as a public service by america's cable television companies. and today, we continue to bring you unfiltered coverage of congress, the white house, the supreme court