Japan lower house passes US trade deal to cut tariffs

The momentum to negotiate a deeper trade deal between the US and Japan has waned with Washington focusing on talks with Beijing, Japanese government sources believe. (Reuters)
Updated 20 November 2019

Japan lower house passes US trade deal to cut tariffs

  • Doubts remain over elimination of car import levies under prime minister’s ‘win-win’ agreement

TOKYO: Japan’s lower house of Parliament approved on Tuesday a limited trade deal Prime Minister Shinzo Abe agreed with the US, clearing the way for tariff cuts next year on items, including US farm goods and Japanese machine tools.

But there is uncertainty over how much progress Japan can make in negotiating the elimination of US tariffs on its cars and car parts, casting doubt on Abe’s assurances the deal he signed with US President Donald Trump was “win-win.”

Japan and the US last month formally signed the limited trade deal to cut tariffs on US farm goods, Japanese machine tools and other products while staving off the threat of higher US car duties.

The government’s proposal to ratify the trade deal will next be brought to the upper house for a vote, but its passage in the powerful lower house increases the chances it will come into force in January.

FASTFACT

Japan and the US last month signed a limited trade deal to cut tariffs on US farm goods, Japanese machine tools and other products .

The deal will give Trump a success he can trumpet to voters, but Abe has said it will bring as much benefit to Japan as to the US.

Japan has estimated the initial deal will boost its economy by about 0.8 percent over the next 10-20 years, when the benefits fully kick in. It also estimated 212.8 billion yen of overall tariffs on Japan’s exports to the US will be reduced.

But the figures were based on the assumption the US would eliminate its tariffs on Japanese autos and auto parts — a major sticking point.

Without those tariff cuts, the reduction in overall US tariffs on Japanese goods would be a little over 10 percent of the government’s projection, according to Japan’s Asahi newspaper and Mitsubishi UFJ Research and Consulting.

After the deal is ratified, Japan and the US have four months to consult on further talks, and Trump has said he wants more trade talks with Japan after the initial deal.

But Japanese government sources familiar with the talks say the momentum to negotiate a deeper deal appears to have waned for now with Washington preoccupied with talks
with Beijing.

“It is unclear whether Washington seriously wants to continue trade talks,” one of the sources said.

“The question is how much time the US can allocate for talks with Japan, even if we start negotiations. There is limited time to conclude talks before the presidential elections.”

Japan and the US already appear to have different interpretations of what was agreed on car tariffs.

Japan has said it has received US assurance that it would scrap tariffs on Japanese cars and car parts, and that the only remaining issue was the timing.

But Washington has not confirmed that.

US Trade Representative Robert Lighthizer has said cars were not included in the agreement, and that it was only Japan’s ambition to discuss car tariffs in the future.

A US document only said customs duties on autos and auto parts “will be subject to further negotiations with respect to the elimination of customs duties.”

“The deal was left vague on the issue of tariff cuts on Japanese auto and auto parts. Otherwise, we couldn’t have reached the agreement,” another source said.

There is also uncertainty on whether Trump will drop threats to impose steep tariffs on Japanese car imports under “Section 232” that gives him authority to do so on national security grounds.

Abe said he had received an assurance from Trump that he would not do that, though analysts say the president could always change his mind, or at least keep Japan guessing.

Opposition parties have attacked Abe for a deal they say is unfair. Critics say Trump could drag
his feet on further negotiations unless he is sure he can win more concessions.

“There is a chance Trump will put pressure on Japan on trade to appeal to his voters,” said Junichi Sugawara, senior research officer at Mizuho Research Institute. “There’s a possibility he could
renew his threat over auto tariffs.”


A Sinai desert community in Egypt leads the way in agritourism

Updated 29 February 2020

A Sinai desert community in Egypt leads the way in agritourism

  • A Sinai desert community in Egypt leads the way in agritourism
  • It hosts a learning center that has partnered with universities to promote a new form of educational tourism

CAIRO: “Community is everything, surround yourself with beautiful souls and watch what happens. So much love, I feel it bubbling out of my chest,” writes Madison Cooper.

The experienced yoga instructor and assistant manager at The Kings Arms pub and music venue in Salford, UK, said this when describing her experience in the Habiba village, a remote beach community in the middle of Egypt’s South Sinai desert.

It was this feeling of peace and tranquility that brought Cairo-born Maged El-Said and his Italian wife Lorena to the Egyptian port city of Nuweiba to settle and eventually start the Habiba community in 1994.

The community is a village that hosts an eco-friendly beach lodge, an organic farm, the Sinai Palm Date foundation and a learning center partnered with universities and organizations around the globe to promote a new form of educational tourism by hosting professional certification courses in permaculture and agriculture ecosystems.

More than 90 percent of Egypt’s land is covered by deserts, Sinai being part of the Eastern desert that occupies more than 20 percent of the country’s surface area, with very few populated villages and cities along the Red Sea coastal strip.

“I am sure there is enormous potential to invest in our huge deserts. The hidden value is in the people if we learn from each other the best way of integrating management of resources,” El-Said said.

This, however, is easier said than done: El-Said, who is now in his sixties, spent almost 20 years taking “agritourism” from a concept to a meaningful business.

He succeeded in 2009, when tourists started coming to volunteer at the organic farm merely to enjoy the experience of isolated serene living.

Before that, El-Said spent several years doing a series of seminars and workshops and inviting local and international experts in organic farming to discuss the agritourism model.

His first introduction to the field was in Italy, where he earned his bachelor’s degree in Italian language and literature in the 1970s.

Italian agritourism gained traction around the time when the agricultural business became less profitable.

Farmers in Italy were giving up, transforming their farms and farmhouses into vacation homes where tourists could stay and experience farming.

“People come to enjoy the beautiful nature and the serene surroundings, eat clean food and leave with fresh ideas and a new perspective on life,” said El-Said when explaining the concept of agritourism.

While the idea is widespread in the US and many European countries, it remains nascent in MENA. Sporadic trials around the region are currently under way, including a licensing program launched by the Saudi Commission for Tourism and Antiquities for farms willing to explore the concept and offer agritourism services.

Expanding the scope of its target community, the Habiba learning center has been working toward hosting a series of certificate program.

Among them are an internationally recognized Permaculture Design Certificate course that provides an introduction to sustainable living systems for a wide variety of landscapes and climates.

The move is intended to attract a more professional interna- tional audience and establish a new breed of educational tourism. El-Said has an ambitious plan for the future, hoping he can establish a desert research hub within his community and start replicating the model in other Egyptian resort cities by the year 2025.

“It is challenging but beautifully rewarding; people are resistant to change, but when they see a working model, it becomes easy for them to follow,” he said.

• This report is being published by Arab News as a partner of the Middle East Exchange, which was launched by the Mohammed bin Rashid Al Maktoum Global Initiatives and the Bill and Melinda Gates Foundation to reflect the vision of the UAE prime minister and ruler of Dubai to explore the possibility of changing the status of the Arab region.