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See also:
Trade Policy Review: Japan
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This ninth Trade Policy Review of Japan has
greatly enhanced Members’ understanding of its trade and related policies as
well as the challenges Japan faces owing to the present global financial
crisis. Our discussions have benefited from the active participation of the
Japanese delegation led by Ambassador Yokota; the insightful and
thought-provoking contributions by the discussant, Ambassador Gero of
Canada; and from the many interventions by Members. Japan’s response to the
large number of questions, made available at the beginning of this meeting,
was very much appreciated.
Members looked forward to a quick and complete
recovery of Japan’s economy. In this context, Members considered that such a
recovery, led by domestic demand, was important for the prosperity of the
world economy and the expansion of international trade. Members were
encouraged that Japan had refrained from introducing new protective
trade-policy measures since the onset of the financial crisis in September
2008. Members also recognized that the multilateral trading system, by
keeping markets open to Japan’s exports, had contributed positively to its
economy in the recent years, and urged that this openness should be
maintained notwithstanding the current difficult economic environment.
Members encouraged Japan to continue its reform process and improve its
market access, particularly in agriculture and services, whose productivity,
and thus competitiveness, is relatively low.
Members welcomed Japan’s active role in the
multilateral trading system, particularly its strong support for the early
conclusion of the Doha Development Agenda. Members commended Japan for its
financial and technical assistance, including Official Development Aid, as
well as various development initiatives related to trade and investment,
particularly its contribution to Aid for Trade. Members also commended
Japan’s support for the process of accession by future Members. Furthermore,
Members expressed their appreciation of the improved preferential market
access provided by Japan to developing and least-developed countries, and
its decision to expand duty-free and quota-free market access accorded to
LDCs. They encouraged Japan to further open its market to these countries’
exports. Members also noted Japan’s increasing involvement in
bilateral/regional trading arrangements. They urged Japan to ensure that
these arrangements are compatible with the multilateral trading system.
Members expressed their appreciation of Japan’s
relatively liberal trade regime. Most applied MFN rates coincide with the
bound rates, imparting a high degree of predictability to the tariff regime.
However, Japan’s tariff remains complex. Applied MFN rates for industrial
products are generally low. Nonetheless, products of export interest to
developing countries, such as agricultural products, textiles and clothing,
leather products and footwear, encounter significant tariff peaks, which
appear to be concealed by non-ad valorem rates, tariff escalation, tariff
quotas (and their intricacies) and/or state trading. Members expressed their
concern about the recent drop in foreign suppliers’ share of Japan’s
government procurement and encouraged Japan to facilitate greater foreign
participation.
While generally appreciating the steps taken by
Japan to harmonize its standards and technical regulations with
international norms, many Members expressed concern over the complexity, and
thus lack of transparency, of Japan’s sanitary and phytosanitary (SPS)
measures, technical regulations, and standards. Some Members questioned the
appropriateness of risk assessment regarding SPS measures, which they
encouraged Japan to employ in the least trade-restrictive manner.
Members noted Japan’s continued enhancement of
transparency and progress in regulatory reforms. Members hoped for further
reforms to enhance competition and thereby improve productivity. Members
looked forward to measures to facilitate inward foreign direct investment (FDI),
which remains relatively low. In this context, Members looked to measures
(e.g. those related to mergers and acquisitions, and corporate governance)
to improve Japan’s business environment. Members appreciated the progress in
privatizing public corporations, particularly the establishment of the new
Japan Post companies. They encouraged Japan to ensure a level playing field
in the markets concerned (e.g. banking, insurance, and express delivery
services).
On agriculture, Members welcomed Japan’s move away
from price to income support. Nonetheless, they expressed concern about
border measures and the relatively high level of overall domestic support
for agriculture. Many Members were concerned about Japan’s use of import
quotas for fish and marine products. On manufacturing, Members were
interested in plans to promote particular sectors. Members encouraged Japan
to continue reforms to enhance competition in services.
In closing, I would like to thank the Japanese
delegation for its active participation in this Review, including its
written responses provided before and during the meeting. We all look
forward to receiving written answers to outstanding questions within one
month. The keen interest shown by Members in this review, as reflected in
the large number of advance written questions, numerous interventions and
high attendance, indicates the importance they attach to Japan’s role in the
multilateral trading system. This Review has clearly indicated that the
Trade Policy Review Mechanism is an important element in ensuring a
transparent multilateral trading system. I am encouraged by the statement by
Japan that despite current difficulties, it has maintained the openness of
its economy and continued to adhere strictly to WTO rules. Nevertheless, I
do hope that Japan will take to heart the concerns expressed by Members,
particularly with regard to its policies regarding agriculture, tariff and
non-tariff measures, SPS measures, government procurement, and FDI.
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