Will Trump administration flout international rules under its new trade policy?: The Yomiuri Shimbun

In its editorial on March 15, the paper says that the Trump administration's latest stance on trade is too self-serving and cannot be accepted.
In its editorial on March 15, the paper says that the Trump administration's latest stance on trade is too self-serving and cannot be accepted. PHOTO: REUTERS

In its editorial on March 15, the paper says that the Trump administration's latest stance on trade - that the US will disregard decisions made by the World Trade Organisation that undermine the country's interests - is too self-serving and cannot be accepted.

TOKYO (THE YOMIURI SHIMBUN/ASIA NEWS NETWORK) - The latest United States report signifies that the country would disregard international trade rules if they were adverse to its own interests. It would even go so far as to implement unilateral countermeasures. That stance must be viewed as too self-serving.

The kind of course to be adopted by the administration of US President Donald Trump in implementing trade policy under its touted "America first" slogan is becoming clear.

The Office of the US Trade Representative has publicised an annual report that states the US will not abide by any decision to be made by the World Trade Organisation if the decision undermines its interests.

The WTO agreement lays down rules to be observed in pursuit of the promotion of free trade. The course of action newly set by the US is tantamount to declaring that the nation will turn its back on the order of trade preserved by nations around the world, placing priority on that purpose over the nations' respective interests.

When it comes to complaints filed with the WTO against trade partners in a dispute, the country to have brought the most cases before the organisation is none other than the US. The US stance means that America will get a trade partner to comply if it wins in a WTO dispute, but will not admit its fault if it loses. Such an opportunist approach cannot be accepted.

What cannot be overlooked is that the annual report refers to Section 301 of the US Trade Act - a provision that could violate WTO rules if it is invoked - and states that the clause "can be a powerful lever" with which to encourage other nations to open their markets.

The Section 301 provision states that the US can unilaterally impose high tariffs and other sanctions on trade partners.

In the past, it served as the measure of last resort for the US government, which brandished that provision every time Japan and the US were locked in a trade dispute over such products as cars and semiconductors. Under former President Bill Clinton's administration, the US presented a plan to slap 100 per cent tariffs on luxury car imports from Japan.

The Trump administration has said that it will shift the focus of efforts from the existing multilateral trade pact to bilateral trade talks. If the US government intends to hint at invoking the 301 clause and to adopt an intimidating stance in this respect, it cannot be overlooked.

The Trump administration must correctly grasp the realities of Japan-US trade, first and foremost. In an opinion paper recently submitted to the WTO, the US government criticised the existence of "a variety of nontariff barriers" in the Japanese car market, while also viewing "substantial" tariffs on agricultural products as a problem.

Japan does not impose tariffs on imported cars. Its automobile inspection system, which the US has singled out for criticism, is not designed to target any specific countries, either. European cars are seeing a steady sales increase in Japan.

In developing products and devising sales strategies, US car manufacturers are neglecting efforts to contrive good ways and means of attracting Japanese consumers. This seems to be the main cause of sluggish sales of US automobiles in our country.

In regard to agricultural products, too, the Trans-Pacific Partnership free trade agreement was to have realised a great reduction in tariffs, including those imposed by Japan on beef. The US has only itself to blame for giving up on such benefits because of its own decision to withdraw from the TPP pact.

A Japan-US economic dialogue aiming to extensively discuss trade and other bilateral issues is set to start next month. Japan should deepen fact-based, constructive discussions with the US, not yielding to misguided US assertions.

The Yomiuri Shimbun is a member of The Straits Times media partner Asia News Network, an alliance of 22 news media entities.