TPP to go down to the wire: negotiator

Movement toward agreement on a landmark Pacific free trade initiative may not come until the last minute of four-day talks in Hawaii later this month, a Japanese negotiator said Friday.



Hiroshi Oe, one of Tokyo's negotiators for the Trans-Pacific Partnership free trade agreement, said that "it may take till midnight of July 31 before everything starts falling into place," referring to the last day of the TPP ministerial meeting in Hawaii.



He was speaking to reporters after two days of talks with Wendy Cutler, acting deputy US Trade Representative and the US negotiator for the TPP.



Mr Oe said the US and Japan cannot settle bilateral issues between themselves alone, because their negotiations affect other TPP partners too. The TPP involves 12 Pacific Rim countries, including the US, Japan, Australia, Canada, New Zealand and Vietnam.



"Many of the outstanding issues are also linked to our discussions with other countries as well as on the overall TPP negotiations," said Ms Cutler, who also spoke to reporters after the bilateral talks. She was apparently referring to free trade in butter and other dairy products, which New Zealand is pushing hard for.



"As we work with Japan in the lead-up to the ministerial, we will also be consulting with other countries as well, on issues that are also being discussed between US and Japan," she added.



Both Japan and the US say the talks need to be wrapped up in Hawaii, or else the negotiations could drift into 2017 or beyond, because the US will be preoccupied with the presidential elections next year. If an agreement is reached this summer, it may give the US Congress just enough time to ratify it by the end of the year.



An agreement in Hawaii is also important for the two countries to demonstrate that they can provide leadership in the region in the face of an increasingly assertive China, offering a model for trade in the Asia-Pacific region that any country fulfilling the conditions can sign up for.



Japan's minister in charge of the TPP negotiations, Akira Amari, said Thursday that he sees a 70 per cent chance of the 12 countries reaching a deal in Hawaii.



"I'm not going to assign a number to my level of confidence," Ms Cutler said. "But we will be working very hard between now and the ministerial with Japan and other TPP partners to lay the groundwork for a successful meeting in Hawaii."



One of the key sticking issues between Japan and the US is the opening up of Japan to rice imports. The market for Japan's staple food is tightly controlled with 778 per cent tariffs on imports.



"We're making progress with respect to exchanging views and what the potential landing zone may be on rice," said Ms Cutler. "But this issue still remains outstanding and will probably be an issue our respective ministers will need to discuss in Hawaii."