DOHA TALKS - JAPAN REMAINS KEEN TO JOIN G-4

C O N F I D E N T I A L TOKYO 002742

SIPDIS

SIPDIS

USTR FOR AUSTR CUTLER AND BEEMAN/MYERS
USDA FOR U/S KEENUM, DUS TERPSTRA

E.O. 12958: DECL: 06/18/2017
TAGS: ECON ETRD EAGR JA
SUBJECT: DOHA TALKS - JAPAN REMAINS KEEN TO JOIN G-4

REF: TOKYO 2717

Classified By: CDA Joseph Donovan, for reasons 1.4 (b) and (d)

Summary
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1. (C) Japan still wants to participate in the small group
of countries that is working to conclude a Doha trade deal --
the so-called G-4 -- and it is the United States alone that
is blocking its participation, MOFA DG for Economic Affairs
Yoichi Otabe told EMIN on June 18. Otabe said that the Prime
Minister assured President Bush personally at the recent G-8
summit of his commitment to a Doha deal, and there should be
no questioning his sincerity. Echoing a message we have
heard elsewhere, Otabe pointed to the difficult domestic
political situation in Japan as a reason the government needs
to be engaged in the talks in order to sell a deal later
domestically. He underscored that LDP Agriculture Policy
Chair Tadamori Oshima was forward-leaning during his June 15
meeting with the Ambassador about tariff rate caps -- but any
flexibility would not be possible if Japan were excluded from
the G-4 process. End summary.


2. (C) While acknowledging that his concerns centered on
process not substance, MOFA Economic Affairs DG Yoichi Otabe
was blunt in underscoring the urgency for the GOJ in playing
a full and active role in bringing the Doha trade talks to a
successful conclusion. He told EMIN the GOJ has increasingly
come to the view that Japan's exclusion so far from the small
group of countries that is trying to hammer out a deal is a
result of USTR's opposition. He said that Japan has received
assurances from India that it is not blocking a role for
Japan, and the Brazilians have similarly expressed a
willingness to see Japan play a role. The Europeans are also
on board, not opposing Japan's position, although Otabe
acknowledged, there may be a little bit of the Europeans
"telling us what we want to hear." We have concluded, Otabe
said, that the U.S. Trade Representative is "the key to
resisting Japan's participation."


3. (C) Otabe said that Japan needs to be viewed as a player
in critical ministerial talks this week in Geneva among the
key countries. This could take shape in several different
forms, starting with Japan becoming a full member in what
would become G-5 meetings this week. The second best
solution would have Japan being consulted by the G-4 prior to
ministerial meetings. Otabe stressed that prior
consultations would be much more valuable than consultations
after the meetings take place. The final option would have
Japan and the United States engaging in high-level bilateral
consultations prior to the G-4, in a process that would
include Trade Minister Amari and Agriculture Minister Akagi
on one side and USTR Schwab and Agriculture Secretary Johanns
on the other.

Comment
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4. (C) There was little new in what Otabe had to say about
Japan's Doha policies, his focus purely on process not
substance. The MOFA DG underscored that PM Abe's commitment
to Doha was sincere, with the PM stating in his bilateral
meeting with President Bush on the margins of the G-8 summit
earlier this month that Japan was ready to play a
"constructive role," and that he has instructed his ministers
to be "as flexible as possible." It is Japan's exclusion
from the G-4 despite the PM's assurances that rankles,
according to Otabe. Reflecting the difficult political
situation for the government, Otabe also noted that the
assurances LDP Ag Caucus leader Oshima made to the Ambassador
last week (reftel) that Japan would fall in line on tariff
caps if that is what is decided was so sensitive that none of
the other ministries knows he made them. Although Otabe
suggested that Oshima's flexibility on tariff caps was
predicated on Japan's being part of the process, he made it
clear that there were options short of Japan's full
membership in a G-5 or G-6.



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