November 13, 2018 / 4:42 AM / a month ago

U.S. VP Pence pushes Japan for bilateral free trade agreement

TOKYO (Reuters) - U.S. Vice President Mike Pence, keeping up pressure on Japan to cut its trade surplus with the United States, said on Tuesday American goods and services too often faced barriers in Japan and a bilateral trade agreement offered the best way forward.

Speaking to reporters after talks with Japanese Prime Minister Shinzo Abe, Pence also said that sanctions on Pyongyang would remain in full force until a fully verified denuclearisation of North Korea was achieved.

“The United States has had a trade imbalance with Japan for too long. American products and services too often face barriers to compete fairly in Japanese markets,” Pence said at a joint media appearance with Abe.

“The best opportunity for free, fair and reciprocal trade will come in a bilateral trade agreement,” he added.

U.S. President Donald Trump has criticized Japan over trade, asserting that Tokyo treats the United States unfairly by shipping millions of cars to North America while blocking imports of U.S. autos and farm products.

Japan says its markets for manufactured goods are open, although it does protect politically sensitive farm products.

In September, Abe and Trump agreed to start trade talks in an arrangement that appeared, temporarily at least, to protect Japanese automakers from further tariffs on their exports, which make up about two-thirds of Japan’s $69 billion trade surplus with the United States.

Japan has insisted the new Trade Agreement on Goods would not be a wide-ranging free trade agreement, but U.S. Trade Representative Robert Lighthizer has said he was aiming for a full free trade deal requiring approval by Congress.

U.S. Vice President Mike Pence and Japanese Prime Minister Shinzo Abe walk together at their joint news announcement at Abe’s official residence in Tokyo, Japan November 13, 2018. REUTERS/Issei Kato

Abe did not comment directly on the nature of a future deal.

“As for the economy, we reaffirmed that we intend to further expand bilateral trade and investment in a mutually beneficial manner in accordance with the Japan-U.S. joint statement in September, and to realise economic development of the Indo-Pacific region that is free, open and based on fair rules,” Abe said.

NORTH KOREA SANCTIONS

The U.S. Commerce Department has submitted draft recommendations to the White House on its investigation into whether to impose tariffs of up to 25 percent on imported cars and parts on national security grounds, two administration officials said in Washington.

In June, North Korean leader Kim Jong Un and Trump pledged to work toward denuclearisation at a summit in Singapore, but there has been little headway on specific steps.

“Our joint actions together with South Korea and the wider world have brought North Korea to the negotiating table and opened the promise of peace on the Korean Peninsula,” Pence said. He said more work remained to be done, and noted that another summit between Trump and Kim was being arranged.

“The sanctions will remain in full force until we achieve the final, fully verified de-nuclearisation of North Korea. The United States, Japan and the world will accept nothing less,” Pence said.

A planned meeting between Secretary of State Mike Pompeo and North Korean officials in New York on Thursday was cancelled. The State Department gave no reason for the delay.

Slideshow (2 Images)

A U.S. think tank said on Monday it had identified at least 13 of an estimated 20 undeclared missile operating bases inside North Korea, underscoring the challenge for U.S. negotiators to persuade Pyongyang to give up its nuclear weapons and long-range missiles.

Japan has said it will not normalise relations with Pyongyang until it takes irreversible and verifiable steps to dismantle its nuclear and ballistic missile programs and reveals the fate of all Japanese kidnapped by North Korean agents decades ago, and to return any who may still be alive.

After meeting Abe, Pence - who repeated that Washington remains committed to the Indo-Pacific region - will head to Singapore for a meeting of regional powers and then to the Asia-Pacific Economic Cooperation forum in Papua New Guinea. Trump is not attending the meetings.

Additional reporting Elaine Lies and Kiyoshi Takenaka; Writing by Linda Sieg; Editing by Chang-Ran Kim and Darren Schuettler

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