FOCUS: FTA among Japan, China, S. Korea Faces Unclear Path

May 11, 2018

Tokyo- An envisioned free trade agreement among Japan, China and South Korea still faces an unclear path after the trio confirmed the need to speed up their FTA negotiations.

At their summit Wednesday, the three nations, which together account for 20 pct of the world gross domestic product, highlighted their unity against protectionist moves by agreeing to accelerate the FTA talks.

But they have different motives behind the unity, leaving uncertainties over how to go ahead toward the envisioned deal that would lower tariffs and facilitate trade and investment.

The three-way FTA talks started in March 2013, a decade after related joint research was launched in the private sector. However, little progress has been made so far, partly because Japan-China relations worsened.

After Wednesday's summit in Tokyo, Chinese Premier Li Keqiang expressed his eagerness to accelerate the FTA talks.

A senior Japanese official said, "We'll work to promote free trade" in cooperation with China and South Korea.

The Japan Business Federation, or Keidanren, also praised trilateral cooperation toward the FTA.

Although the three countries agreed on the principle of promoting free trade, they look far apart in motives.

Beijing apparently aims to ally with Tokyo and Seoul under the banner of free trade so that it can better counter the United States, with which China has a trade dispute.

Japan, for its part, pursues a "comprehensive, high-quality" trade deal, according to a government source.

The new Trans-Pacific Partnership free trade accord among 11 countries excluding the United States has highly transparent rules, including on intellectual property protection.

In connection with this, Abe told Li during the summit that China should fully observe international rules, clarifying a difference in the two countries' positions.

Meanwhile, Japan faces U.S. pressure to conclude a bilateral FTA.

South Korea has an FTA with the United States, while it is heavily dependent on the Chinese economy. Seoul is considering joining the TPP, which includes Japan but not China.

South Korea is likely to struggle, caught between the three big economies. Jiji Press