Negotiations just started last week. There are various issues on the table. The timeline and the scope for the discussions are still somewhat unclear. But there also seems to be some momentum on that front. And Abe would also like to use this visit to set the economic relationship on a positive trajectory.And then, thirdly, I think Abe will also try to set the stage for the president’s state visit to Japan. He is going to visit Japan May 25th through 28th. He will have an audience with the new emperor, which is a distinct honor and shows the importance that Japan places on the relationship with the United States. And so they’ll probably try to tee up that visit, and also do what he’s done throughout the Trump administration, which is mainly maintain close channels of communication with the president to sustain momentum in the relationship.And so we have this state visit in May. Abe will host the G-20 summit in June in Osaka. And then you have the G-7 summit later in the summer. So there are several opportunities in the next few months to discuss the U.S.-Japan relationship, which is in good shape overall. But as Dr. Green mentioned, the key words during the Trump administration is uncertainty. Anything can happen in these meetings.So let me turn it over to Dr. Green to talk about some of the dynamics in more detail.MR. GREEN: Thank you, Nick.So Prime Minister Abe has had more face time with President Trump and more telephone calls than any other world leader. And he probably also has the best batting average with President Trump in terms of successful summits, or at least summits that don’t do harm, and in many cases strengthened the relationship. He’s looked at by other world leaders, including close U.S. allies like Britain and Canada, as really setting the standard for how you do summits with this administration. So his record is very good, but there’s always uncertainty.A good outcome for Abe in the three areas of security, economics, and then diplomacy, would be, first, on security, that there is a common agreement on North Korea, as Nick said, and also that the president does not badger Prime Minister Abe about cost sharing for U.S. bases. The president reportedly has demanded that five allies, including Japan, pay all costs of U.S. forces plus a 50 percent markup. That is essentially a nonstarter for any of these allies.Abe would prefer not to get in an argument about it, take some time, think through ways to improve Japan’s support without getting in an argument about what, by almost anyone’s measurement, is a pretty extreme demand from the president. So a good outcome would be to just not have that be an issue and let the experts work on it.On the economic side, a good outcome for Japan would be an agreement of what the Japanese side calls a balanced trade agreement, where the U.S. gets access to TPP levels of market for agriculture, especially beef, where Japan’s FTA with the other TPP 11 countries and the EU is crowding the U.S. out of that market because those countries are exporting with decreasing tariff schedules.And in exchange, the U.S. would give something to Japan that would allow the Japanese side to pass the tariff agreement in the Diet. This has to go into law in Japan. And the Japanese ask is what it was in TPP, that the U.S. reduce the tariff on auto parts into the U.S. That would be a good outcome for Japan if they could get that. A decent outcome would be just an outline, if not that specific, balanced with both sides taking action agreement.And then a good outcome on the diplomatic side for Abe would be if President Trump committed to go to the G-20, which Japan is hosting in June. He’s going in May for the first state visit with the new emperor of Japan. It’s a tall ask for him to go back to Japan just a few weeks later. But that would be a good outcome and Abe clearly wants that, for the G-20. But perhaps at least as important, if not more important, is that Donald Trump go to the G-7, which is in France in August. His last G-7 meeting – Trump’s last G-7 meeting ended very bad. You’ll recall he left Canada disavowing the joint statement that the leaders has signed onto. And Secretary Pompeo did not go to the G-7 foreign minister’s this year.For Japan, G-7’s really important. They’re not in the Security Council as a permanent member. The G-20 includes too many countries. The G-7 is the core economic powerhouses that are democracies. And Abe would also like President Trump to go to the East Asia Summit this year. So that’s a pretty tall ask, but a good outcome would be a commitment. I think Japan has a pretty good chance of getting the president to commit to the G-20. The other ones are tougher.Now, a really bad outcome would be if the president badgers him on security on the cost-plus 50 percent, as I said. Really bad outcome on the trade side would be if the president not only doesn’t agree to opening auto parts, tariffs, but demands voluntary export restraints of autos from Japan, or something piling on to of what Lighthizer’s already negotiating. And a bad outcome on the diplomatic side would be if it becomes evident that the president’s not going to go to any of these summits.So there’s a lot at stake. And I don’t think that the issue that’s I’ve described – I don’t think the two governments know exactly where they’re going to come out. I think on all three the good or bad scenario are possible. And so what actually happen when the two leaders meet over dinner and golf will be really consequential. I’ll stop here and let Matt pick up.MATTHEW P. GOODMAN: OK. This is Matt Goodman. And just to say I think both Nick and Mike have covered the basic stakes on the economic side. I think both Trump and Abe themselves have an incentive to try to get a quick deal, along the lines, as Mike stated, of Japan giving the same agriculture market access that they’re giving Australia, and Europe, and other exporters. And that’s good for Trump because he’s getting pressure from U.S. ag exporters who are losing market share in the market and Japanese tariffs drop for these other partners. And then for Abe to get something quick on auto parts along the lines of what the U.S. gave Japan in TPP, as Mike said.You know, the problem is that both of those things require the respective legislatures to act – the Diet in Japan and Congress in the U.S. And that’s not easy at any time, but it would – on the U.S. side in particular, if you get Congress involved in this, then it’s going to open a potentially Pandora’s box of other issues, because there are other things stewing around about, you know, currency, about pharmaceutical market access and pricing, about regulation, about a bunch of other things. So it’s – that’s the dilemma or the sort of Catch-22, is, I think a quick deal would be in both leaders’ interests, but they get caught up in their legislatures.You know, and then to Mike’s point, you know, the question – the uncertainty out here is what President Trump will settle for. You know, will he settle for, you know, that kind of deal on ag and, you know, maybe some superficial change on auto market access to Japan Or will he insist on, as Mike suggested, some kind of quota on Japanese auto exports to the United States, even though most Japanese cars now made – or, most of the content of Japanese cars sold in the United States are made in
North America. But Trump seems to want to get at that bilateral trade deficit, and particularly in autos. And so that’s what everybody’s sort of uncertain about, is how hard Trump’s going to push on that.I think they both – or, at least certainly Abe – would like to get past this trade stuff – the bilateral trade stuff – to be able to focus on a broader set of economic issues, notably the digital governance questions that both sides have a strong interest in, and that Abe laid out in his speech at Davos back in January as one of the things he was going to prioritize in his G-20 host year. He says he wants the Osaka G-20 summit to be remembered as the one where there was the beginning of a conversation globally about data governance, and laid out this notion of free flows of data with trust – which means a sort of privacy, security-based sensible set of basic rules on privacy and security, but then essentially free flows of data above that. And that’s the U.S. and Japan preferred outcome. But, you know, China, and Russia and others, you know, have a different view. And so that – there’s a huge stake in that, and that’s what I think Abe really wants to get onto.And then more broadly, on China, they both have an interest I think in trying to get at some of the practices that are of concern with China – forced technology transfer, excessive subsidization, you know, restrictions on market access for American and Japanese companies. And so those are really the things that I think are most important. The only other economic issue that’s sort of floating around out there that could be talked about – but my guess is Mike and Nick may have views on this as well – is the Iran sanctions issue, because Japan has been receiving, among seven or eight countries, waivers from the sanctions to be able to continue to buy Iranian oil. But, you know, the U.S. administration has said that we’re going to end those – or, not renew those waivers. And that would mean that, you know, these – Japan and other allies would be potentially subject to secondary sanctions.In reality, Japan has reduced its dependence on Iranian oil pretty substantially from, I think, Mike, when we were doing this back in the day it was something like 20 percent of their oil imports and it’s now down to about 3 percent, I think. So it might not have a huge impact on Japan, but that issue’s kind of floating out there. And my guess is Abe’s not going to make a big deal about that, but it might come up. I think probably –MR. GREEN: Just to jump in, Matt, on the last one, my understanding is that Abe is not going to fight that one. It’s just not important enough, and the other issues you discussed are much more important and not worth complicating by having a fight over Iran and, you know, Abe being on the same side as China on an issue with the U.S. So I think it’s not going to – not likely to be an issue that causes sparks, the Iran one.MR. GOODMAN: Right. Just one more quick thing, which I forgot to mention, which is to Mike’s point about whether President Trump is going to go back to Japan in late June for the G-20 summit. As Mike would agree, we can’t think of an example where a President’s gone, you know, twice within a month to the same country. That’s a big order. But there is, in addition to Abe’s appeal, there’s one particular reason why Trump might need to go to Osaka, which is it to meet President Xi Jinping of China to shake hands on their, you know, possible, maybe impending, trade deal, because that would be the first opportunity for those two leaders to meet. So that’s another possible incentive for Trump to go, if his deal is done. And I’d say, only if the deal is done, because I don’t think they’ll want to meet otherwise.MR. SCHWARTZ: Great. With that we’d like to open it up to your questions. Please ask away.OPERATOR: (Gives queuing instructions.)
And we do have a question from the line of Nirmal Ghosh. Please go ahead.Q: What’s that?OPERATOR: Nirmal, your line is open.Q: Yeah, can you hear me OK?MR. GREEN: Yes.Q: Yeah. Nirmal here from The Straits Times.I just wondered, before the Singapore summit, in the run-up to it, there was a lot of talk, of course, as was mentioned by one of you a little earlier in this call, about the abductee issue, that, you know, the president should bring it up with Kim Jong-un and so forth. And I think the president did, in fact, say that he would. And then that was pretty much a – we didn’t hear much about it after that subsequently. So I wonder, has – is it still sort of on the map in terms of the U.S.-North Korea issue? Is it – you know, what is the status of that issue right now, as far as Japan is concerned?MR. GREEN: It’s Michael starting, and Nick weigh in if you’d like.
It’s very much at the top of the diplomatic agenda and the political agenda for the Japanese government. And I’m certain Abe will raise it. I think in general this is an area where Abe and the Japanese government have been pretty happy with President Trump and his team. They have – the U.S. side has raised the issue at all levels with the North Koreans. One evidence of how important this is, is that the chief Cabinet secretary of Japan, Mr. Suga, is coming to New York on May 8th, I think, or 9th, and then to Washington briefly, to give a speech at the U.N. on the abductee issue, on human rights in North Korea. There’s no precedent for the chief Cabinet secretary to travel abroad. Their job is to run the Cabinet all the time in Tokyo.Suga is dual-hatted. He’s in charge of abductee issues in addition to being chief cabinet secretary. And that’s the – that’s the reason he’s coming to the U.S. is to give the speech. And then he’ll meet in Washington, I am told, with the vice president, secretary of state and others to talk about this and other issues, but principally the abductee issue. So it’s very front and center.I think the real reason Suga is coming is more political. We can talk about it if people are interested. But it’s very much at the center. And it is an area where I think the Abe government has been generally quite satisfied with the efforts of the Trump administration.Q: OK.MR. GREEN: Next question, please.OPERATOR: (Gives queuing instructions.)
We have a question from the line of Darlene Superville. Please go ahead.Q: Hi. Thanks for doing this briefing call.
I was wondering if somebody could talk a little bit about how this meeting – you know, sort of the back story of how the meeting came together in the first place. I’m just wondering why Abe is coming here for such a short visit if President Trump is going to be in Japan in just a matter of weeks. What is so important about Abe being here Friday and Saturday to attend the first lady’s birthday dinner and to play golf with the president and talk about these issues when Trump is going to be visiting him soon? Thank you.MR. GREEN: Well, yeah.Q: Can you identify yourself before you speak?MR. GREEN: Sorry. It’s Mike Green from CSIS.
So ostensibly the prime minister is visiting with the leaders of the G-7 countries, because Japan views the G-7 as the most important grouping it belongs to. And so he’s been in Europe and he’s been meeting with other G-7 leaders.Q: OK.MR. GREEN: But I think the real urgency is that Abe has, as Nick said, an election in July for the upper house. In Japan he’s positioned to do well. But if he does badly, it could cripple his government. When he was prime minister in 2006 and ’07, his government came apart because he lost an upper-house election and the opposition was able to block legislation and the wheels came off.And so this is a very, very sensitive political time for Abe. And the president’s coming in late May. And the administration has threatened to do Section 232 auto tariffs against Japan, which would be politically and economically devastating. And so that’s a pretty heavy set of issues to leave unresolved until Trump comes in late May –Q: OK.MR. GREEN: – and then have potentially explode during the state visit, the first state visit with the new emperor; really high risk for Abe. So he needs to settle as much of this as he can.
I think, frankly – and Matt should weigh in – I think he’s going to have a very hard time getting an outcome on trade that works, because the balanced agreement the Japanese hoped to get – you know, we’ll let you in on TPP levels of market access on ag if you give us what you were going to give us on TPP, which is, you know, reductions in the auto-parts tariffs – I don’t think Donald Trump’s inclined to do that at all.
And so it’s going to be ambiguous, I suspect, the outcome. But the urgency, I think, is the political risk of President Trump coming to Tokyo, meeting the emperor before an upper-house election, without any level of – higher-level effort to corral him and get some, you know, good outcome.And the problem the Japanese and many governments have with the Trump administration is they can get an awful lot done. They can negotiate things with USTR, with the State Department. But
what the president decides can be completely different. So Abe kind of has to do this. This is not normal, but he kind of has to do this.Q: OK, thank you.OPERATOR: There’s no further questions on the phone lines.
We actually do have a question from Noah Bieberman (sic; Bierman). Please go ahead.Q: Hi. This is Noah Bierman with the L.A. Times. Thank you.
Just along the lines of what Mike was just talking about, if you could expand a little bit further. I mean, Abe has been probably the most solicitous world leader of Trump. You can correct me if I’m wrong on that. But I’m wondering, you know, has – whether he’s gotten anything out of it and if his approach has, you know, borne out how other world leaders, you know, see his approach and if they think it’s been effective both for his relationship and for his domestic politics.MR. GREEN: It’s Mike Green again. I’m sorry. Please weigh in, Nick, but – in that. But the Japanese people do not react to Donald Trump the way Europeans do. Some are horrified. Some are fascinated. There is a Japanese version of the “America First” movement. There’s a certain nationalism in Japan and Trump even appeals to a certain constituency.In any case, the numbers are not as bad for Donald Trump in Japan as they are in Europe and so Abe doesn’t pay a price for spending so much time with the president and cozying up to him the way that a Merkel or a Macron would. Abe’s also a – kind of a fun guy for President Trump. I think President Trump, although he is throwing some very, very difficult problems at Abe, appears to like him and so does Melania, the First Lady, and that – and Abe seems to enjoy that and find it useful.So it’s hard to point to too many big wins that Abe has gotten from this sustained and close personal relationship. Certainly, the abductee issue, as I mentioned, would be one. But the other way to look at it is, so far Donald Trump hasn’t done anything really bad to Japan. I mean, you know, there are a lot of very, very dangerous issues for Japan that have been surfaced by the president about host nation support for U.S. forces, about tariffs on autos, about peace agreements with North Korea, and so far he hasn’t done any of them, and I think at some level the Japanese press and public realizes that may be in part because Abe spends so much time with him.So on a defensive – in a defensive way, Abe’s done very, very well and there is also this concern always in Tokyo that the president – this president or any president might sort of tilt to China, and the Trump administration’s been pretty hard on China but the president himself has had kind words about Xi Jinping. And so I think the Japanese public recognizes it’s a good thing for them if the president and prime minister are, you know, spending a lot of time together so there isn’t what the Japanese press calls Japan passing.More broadly, below the level of Donald Trump and aside from trade issues and national security, Abe’s government has done pretty well with the U.S. – very closely aligned on North Korea policy below the level of Donald Trump. The U.S. strategy for the region is called the free and open Indo-Pacific strategy. That’s a – that’s a catch phrase and a concept that was proposed to the administration by Japan. So a lot of alignment on national security issues, which I think also to some
level can be attributed to what Abe’s done. But I’m not sure other world leaders could do what Abe does. It takes a certain personality.MR. SCHWARTZ: Nick wants to jump – Nick Szechenyi wants to jump in here.MR. SZECHENYI: Yeah. I would just make – I would just add on to that, briefly. You know, I think it’s important to recognize that the one thing the Japanese government doesn’t do that other allies and partners have done is criticize the Trump administration in public. Yes, there are serious challenges in the U.S.-Japan relationship and a lot of difficult issues to sort through.But Prime Minister Abe is very disciplined and always emphasizing the importance of this relationship and his commitment to carrying it forward with the president and I think that’s quite significant, and, thus far, of course, the Trump administration – the president has, largely, reciprocated by saying positive things about Prime Minister Abe and about Japan. But in the last few joint press conferences the president has aired his concerns about economic issues and the trade deficit and what have you.So one of the things we might want to watch out for on this occasion is the extent to which President Trump sort of avoids diplomatic language and speaks more bluntly about his concerns about Japan. If he does that, that could be a signal of some of the challenges that they’re going to face, going forward.MR. SCHWARTZ: Any more questions?OPERATOR: There’s no further questions on the phone line.
MR. SCHWARTZ: OK. If there’s no further questions, then going once. Going twice.Thank you all for participating in our call today. We’ll have a transcript out ASAP. Thanks again for participating in the briefing. That concludes our call.
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