China And Economy To Lead Abe US Talks

By: Posted By Jovarie Downing
By: Posted By Jovarie Downing

Tokyo (Financial Times) -- The last time Shinzo Abe was Japan's prime minister, from 2006 to 2007, he staked his job on a campaign to strengthen ties with the US. But as he heads to Washington for his first summit since retaking power, any expectations of American gratitude will have to be tempered by new and complex political realities.

Mr Abe's meeting with Barack Obama, the US president, on Friday is expected to focus on economic issues and, as ever, the US-Japan military alliance, cornerstone of Asia's regional-security edifice since the second world war.

During his first stint as Japan's leader, at a time when the Bush-era US was fighting wars in Iraq and Afghanistan, the hawkish Mr Abe championed an unpopular "anti-terror" law that allowed Japanese tankers to refuel Nato warships operating in the Indian Ocean. A voter backlash, combined with health problems and an upper house election defeat, soon forced him from office.

Now back in power five years later, Mr Abe remains keen on extending the military partnership, which in spite of the presence of thousands of US troops on Japanese soil is circumscribed by Japan's anti-war constitution. For Japanese conservatives, the growing assertiveness of China -- tussling with Japan over the Senkaku Islands in the East China Sea -- and advances in North Korea's nuclear programme have only made the need for stronger ties more urgent.

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Staying away because of island dispute Yet it is that very eagerness, analysts and government officials say, that has put some in the Obama administration on their guard against Mr Abe. Washington is wary about provoking the new leadership in China and is also concerned about new tensions between Japan and one of its other key allies in the region, South Korea.

"Japan's government now is clearly hawkish and from the US point of view that is reason for caution," said Yoshiki Mine, a former Japanese diplomat who is now a research fellow at the Canon Institute for Global Studies. For years, Washington has encouraged Tokyo to take a more active role in the alliance, but the view today, he believes, is that "a more hawkish Japan is not necessarily a good thing".

US officials confirm they would still like Japan to embrace the principle of "collective self-defence" -- meaning, for example, that Japanese troops could provide logistical support to US forces engaged in battles outside Japan, or help shoot down a theoretical North Korean missile headed for the US. But they want to move slowly to avoid antagonising China, South Korea and other Asian countries still bitter about Japan's early 20th-century empire-building.

"Ideally we would like to see a world where Japan could do these things and its neighbours would be OK with it, but we aren't there yet," one official said. Mr Abe's retrograde views on wartime history -- he has spoken of retracting past apologies for abuses committed by Japan's imperial forces -- have made him a poor salesman for unfettering Japan's modern military.

On the Senkaku Islands, the Japanese-controlled group that is claimed by China and has been the site of a tense stand-off, the US has assured Japan that the area falls under the defensive umbrella of a US-Japan security treaty but has refused to take a position on the underlying ownership issue and has made clear its extreme reluctance to be drawn into a Sino-Japanese confrontation. Few believe Mr Abe will receive any more eager support during his visit.

Washington has been broadly supportive of the new prime minister's efforts to revive Japan's sluggish economy by increasing government spending and loosening monetary policy, even as those efforts have led to a sharp fall in the yen that has alarmed some of Japan's trade partners. Mr Abe is expected to ask Mr Obama to help his cause by approving the export of newly abundant shale gas to Japan, something that could help bring down Japanese energy bills, which have soared since the Fukushima nuclear disaster in 2011 forced the country to increase imports of fossil fuels.

Some US industry groups oppose exports on the grounds that they could push up domestic gas prices.

In contrast to the 1980s, when US-Japan summits were preoccupied with Japan's huge trade surpluses, the post-Fukushima energy crisis and the declining competitiveness of Japanese export industries have turned the country into a trade underdog -- its trade deficit in January was a record Y1.6tn.

Mr Abe is facing a difficult decision over whether to enter negotiations to join the trans-Pacific Partnership free-trade bloc, a US-driven initiative supported by Japanese business but opposed by farmers -- two core constituencies for Mr Abe's Liberal Democratic party. He has said he will seek assurances from Mr Obama that Japan could keep tariffs on certain sensitive goods, presumably agricultural ones.

But US officials are adamant that he will not get anything so explicit, given the risk that other countries would respond by asking for similar guarantees of their own. But even a non-committal statement that did not rule out protecting "sacred" areas might be spun by Mr Abe as a victory, allowing him to enter negotiations if not actually win a deal that will satisfy his rural Japanese rice growers.

© The Financial Times Limited 2013

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