Originally Published 2013-03-30 00:00:00 Published on Mar 30, 2013
China, Japan and South Korea have a long way to go in their trilateral free trade agreement. The road to an agreement is going to be long and complex. However, how this trilateral venture is going to be viewed by the US is to be watched with care and interest.
PM Abe waiting for the right time to push his pet ideas?
Japanese Prime Minister Shinzo Abe has just completed three months in office. Judging by his performance so far, one can say that he has demonstrated considerable caution and maturity in his approach to several key economic, political and diplomatic challenges confronting him. He knows that the majority of Japanese voters, who elected the LDP in the December polls, did so not because of their liking for that party, but because they were too disappointed with the dismal performance of the Democratic Party of Japan (DPJ). At the LDP party convention held on 17 March, Abe told his party men not to be too complacent "since our landslide victory was due primarily to the people's judgement that our party is (only ) a bit better than the Democratic Party of Japan ." He therefore stressed that the LDP could regain the trust of the people only by "producing tangible, positive results one by one."

Approval ratings for the Abe government have steadily risen from 65% in December 2012 to 72% by the third week of March, 2013. The LDP at its party convention endorsed strongly the various measures that the Abe government has taken since coming to office. And one single dominant theme running through the proceedings of the convention was the need for the party to set its focus on the crucial upper house election scheduled to be held in July this year. If the LDP-New Komeito coalition wants to implement its political and economic agenda, it is absolutely essential to end the prevailing parliamentary hiatus by securing a majority of seats in the House of Councillors.

Abe is in no hurry to push his pet ideas into action immediately. He has not forgotten his bitter experiences of 2006-7 when he badly lost the upper house election that ultimately paved the way for his exit. A chastened man now, Abe believes that unless the Japanese economy rests on a solid and sound basis, he cannot make any advance in his quest to bring about changes in Japan's constitution or defence policies.

How to revitalise an economy that has been afflicted with stagnation for more than two decades is the single most important preoccupation of Abe's government. The two policy speeches Abe delivered at the Japanese Diet (on 28 January and 28 February, 2013) are predominantly focused on the economic measures that the government had in mind for recovery and revitalization. Abe appointed Mr. Haruiko Kuroda as the new chief of the Bank of Japan which has set the price stability at 2%in terms of the year-on-year rate of change in the consumer price index. In order to breathe a new life into the economy, the government adopted the Emergency Economic Measures for the Revitalisation for the Japanese Economy in the first half of January, 2013. Under this, the government has started taking vigorous measures for post-Fukushima reconstruction and also for improving the country's infrastructure for disaster prevention and mitigation. Further, the emergency measures are intended to contribute to sustained growth through promoting business investment, innovation and human capital development. Abe believes that the previous governments had failed to promote growth because they had not formulated long-term growth strategies.

In the realm of foreign policy, Abe has shown considerable restraint in his reaction to China's provocative conduct. In his policy speech at the Diet on 28 March, he asserted that the Senkaus are "an inherent part of Japan" and that there is no "issue of territorial sovereignty to be resolved ..." At the same time, he described Japan-China ties "as one of the most important bilateral relationships." He urged China to act with restraint that could prevent one single issue from "impacting on the relationship as a whole." Reluctant to climb the "ladder of escalation", Abe showed his willingness to "keep his door open for dialogue." Abe also did well to send Mr. Natsuo Yamaguchi, leader of the New Komeito Party, -- LDP's coalition partner -- to Beijing to meet Chinese leaders in a bid to show Japan's interest in normal bilateral relations. It is also important to note that both Japan and China share deep concerns on North Korea's nuclear programme and cooperated particularly in the drafting of the second UN Security Council Resolution taking stronger sanctions against Pyongyang.

Though described as a right-wing hawk, Abe is not going to pursue his nationalistic agenda without any circumspection. He believes strongly in amending the constitution so that Japan could become a normal state and enjoy the right to collective self-defence. He believes that the Kono statement issued by then Cabinet Secretary, Mr. Yohei Kono in 1993 on the comfort women issue should be modified. But he also knows that these sensitive issues will provoke strong and hostile reactions not only from within Japan but beyond its shores. He is therefore inclined not to act in haste, but to wait preferably until the outcome of the upper house election.

The only issue - by no means non-controversial - on which Abe took a rather quick decision is Japan's entry into TPP negotiations. It is well-known that that the LDP opposed Japan's participation during the December election campaign. But since TPP is considered as an important element in America's pivot to Asia, both sides discussed this issue at the time of Abe's visit to the US in February, 2013. After getting assurances from the Obama administration that Japan's participation in TPP would not be predicated upon a total elimination of all tariffs, Japan found the door open for its participation. Abe took another three weeks before he announced his final decision to join the TPP on 14 March. In fact, time was running out for Japan. Eleven TPP member countries have already had sixteen rounds of negotiations and discussed the various aspects of the agreement for three years. Japan has already lost a great deal of time. If Japan wants to derive the maximum advantages from the treaty, then it has to engage in the discussions. It is speculated that even after Japan's decision to join the TPP talks, its actual participation could take place not before September due to procedural difficulties. In the meantime, Abe should try hard to assure many segments of the LDP belonging to the strong farm lobby that Japan's participation in the TPP will not damage their interests.

In the meantime, it is interesting that China, Japan and South Korea have just started their preliminary talks for a trilateral free trade agreement. Given the size of the economies of these three Asian giants and the vast competitive interests involved in their economic interactions, the road to an agreement is going to be long and complex. How this trilateral venture is going to be viewed by the US is to be watched with care and interest.

(K.V. Kesavan, a distinguished fellow, ORF, is currently, a Public Policy Scholar at Woodrow Wilson Center, Washington DC.)

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