Skip to Content
Home | news | In the News

In the News

The Detroit News: Report: U.S. drops bid to end Japanese import rules

The Detroit News

The Obama administration declined to comment on a report Monday that U.S. trade negotiators will end their bid to convince Japan to lift tough requirements on car imports after Japan agreed to expand a tariff-free quota for imported U.S. rice.

Nikkei Asian Review reported the U.S. Trade Representative Michael Froman's office will end efforts to convince Japan to drop standards on car imports in exchange for Japan's agreement to import an additional 10,000 tons of U.S. rice. The report said talks will begin in Washington on Wednesday aimed at working out the details — and a deal means it is more likely a final deal on a 12-nation Trans-Pacific Partnership could be reached by spring.

Trevor Kinkaid, a spokesman for Froman, said the office had no comment on the report. Froman is set to testify Tuesday in front of the Senate Finance Committee. It comes as the Obama administration is pushing Congress to quickly approve "fast track" trade legislation that would guarantee any trade deal gets a yes or no vote without amendments from Congress.

In April 2013, Japan announced it would more than double the number of motor vehicles eligible for import under its fast-track rules. Detroit's Big Three automakers are now be allowed to export up to 5,000 vehicles annually of each vehicle type under the program, compared with the prior ceiling of 2,000 vehicles per vehicle type.

The U.S., Japan, Mexico, Canada and eight other nations have been negotiating the Trans-Pacific Partnership that would create a free trade zone comprising 40 percent of the world's economy for more than four years. Australia, Brunei, Chile, New Zealand, Malaysia, Peru, Singapore and Vietnam are part of the talks.

Automakers have been pushing for at least three years to convince the Obama administration to include provisions in the agreement barring the countries from currency manipulation, but Treasury Secretary Jacob Lew and Froman have repeatedly shown no interest in doing so, arguing such issues are better addressed by global forums like the World Trade Organization.

Automakers worry that foreign governments — like Japan — will be able to weaken their currency to undercut U.S. vehicle production.

The administration may be dropping efforts on the auto provision because automakers have taken a hard line in only seeking currency changes.

"We can compete against anyone anywhere — but we can't compete against the Bank of Japan," said Ziad S. Ojakli, Ford Motor Co.'s group vice president, government and community relations.

Asked if Ford would accept any other provisions in lieu of currency in a 12-nation free trade deal, Ojakli said no. "We need to have strong enforceable disciplines in any thing that moves — whether it is trade promotion authority or TPP. ... All we're looking for is the internationally accepted principles (on currency)."

Ojakli said the agreement must put "teeth" in those rules that are part of other international agreements. "Let's enforce the rules that we've all agreed to worldwide. How crazy is that?" Ojakli said.

A group of Democratic lawmakers from Michigan are among those strongly opposed to a deal without currency changes.

Rep. Debbie Dingell, D-Dearborn, said a bad deal "could do real damage to the middle class." Fast-track trade legislation "does not allow Congress to address countries that manipulate their currency to gain an unfair advantage, which is the mother of all trade barriers," she said. "This is unfair, and it puts U.S. jobs at risk."

Click here to read the full story.

Back to top