Negotiations for an ambitious trade pact among Pacific countries made significant progress over the weekend but there is still a gap between Japan and the United States over market access and other hurdles, trade representatives said on Monday.
The 12-nation Trans-Pacific Partnership (TPP) is central to President Barack Obama’s policy of expanding the US presence in Asia and the president has expressed hopes of concluding a deal by the end of the year.
But while all sides hailed the progress made during the latest round of talks, no breakthrough was forthcoming on the thorniest questions.
“There is no prospect for an agreement on market access (between Japan and the United States) at the moment,” Japanese Economics Minister Akira Amari told a news conference in Sydney.
“I expect we will reach results that satisfy both (countries),” he said, adding they would hold further talks.
An agreement between Tokyo and Washington is crucial to securing the broader pact as other partners are reluctant to commit until they see how those two resolve their differences, particularly over access to each other’s markets in sectors such as agriculture and automobiles.
Australian Trade Minister Andrew Robb, who hosted the meeting, said the shape of an “ambitious, comprehensive, high-standard and balanced deal” was forming.
“There is a real sense that we are within reach of the finish line and the prize does look very attractive,” Robb said, describing the negotiations as at the “compromise stage”.
“We are seeing a preparedness to make some of the difficult decisions. This includes some of the key issues that we’ve been circling for a long time in the whole IP (intellectual property) area and market access and state-owned enterprises and other areas.”
The United States insists that Japan should lower barriers to agricultural imports, but Japan wants to protect sensitive products, including pork, beef, dairy and sugar.
U.S. Trade Representative Michael Froman said that by definition the issues left at the end of any negotiation are those that are the most difficult to solve.
“We certainly have outstanding issues with Japan on market access - on agriculture, on autos and we are not done yet,” he told Reuters.
“And while we are making progress, we are not at a satisfactory resolution yet and that’s why the work is going to continue.”
Other major outstanding issues include intellectual property rights, particularly on products such as pharmaceuticals, environmental protection and country-specific issues around state-owned enterprises.