Representatives from the 11-nation Pacific trade pact the Comprehensive and Progressive Agreement for Trans-Pacific Partnership meet in Santiago on March 8, 2018. Photo: AFP/Claudio Reyes
Representatives from the 11-nation Comprehensive and Progressive Agreement for Trans-Pacific Partnership meet in Santiago in 2018. Japan is a key gatekeeper in the pact. Photo: AFP / Claudio Reyes

SEOUL – Japan’s top government spokesman sounded hesitant Tuesday about granting South Korea’s accession to the multilateral Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), or TPP-11, trade pact, following Seoul’s statement of interest the day prior.

“What we need to do first is to see if an economy that seeks to join the pact is fully prepared to reach the high levels of the TPP-11,” Chief Cabinet Secretary Hirokazu Matsuno told a press conference, Kyodo News Agency reported from Tokyo.

As South Korea is a member of major global economic organizations and is a signatory to a wide range of multilateral and bilateral free trade agreements, or FTAs, it would appear well prepared.

“We will continue to follow developments related to economies with interest in joining the pact,” Matsuno said.

But his next comment suggested that Tokyo could be weighing political rather than trade or economic factors. He said Japan would respond “by taking into account our strategic standpoint and public understanding.”

That remark may be a reference to sensitivities in Japan’s agricultural sector. Both countries share similar crops and staples, but there have long been fears among Japanese farmers that tariff-free South Korean agricultural exports would undercut them in their own market.

This analysis is buttressed by Japanese Agriculture, Forestry and Fisheries Minister Genjiro Kaneko’s refusal to comment, beyond saying that no formal application has been filed by South Korea.

But there is another possible interpretation of Matsuno’s remarks. Japan is the leading economy, and de facto loudest voice in TPP-11, at a time when Seoul-Tokyo relations are dire.

A picture of Japanese former prime minister Shinzo Abe behind a statue of a young comfort women during a 2019 protest in Seoul. Comfort women issues bedevil Seoul-Tokyo relations. Photo: AFP / Jung Yeon-je

This suggests that the cabinet secretary’s remarks may represent a rare sniff of leverage over South Korea a neighbor with which Japan is constantly at odds.

The perfect fit?

South Korean Finance Minister Hong Nam-ki told the cabinet on Monday of Seoul’s interest in applying for TPP-11 membership, Yonhap News Agency reported.

On the surface, G10 economy South Korea looks perfectly aligned. An OECD and WTO member, it boasts a Pacific location and as a trading country already has 17 bilateral and multilateral FTAs, covering 57 nations, according to government data.

While Japan has 21 FTAs, South Korea is ahead of its neighbor in some ways. It signed an FTA with the EU years before Japan did and the terms of its FTA with the US are far more extensive than Japan’s.

The TPP-11 entered into force in 2018. It is a regional trade pact binding Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam.

The TPP-11 is the outgrowth of the TPP, which suffered a major body blow when then-US president Donald Trump, who favored bilateral rather than multilateral trade deals, pulled America out of the pact in early 2016.

TPP-11’s status as a “gold standard” trade pact is widely recognized. China and Taiwan – and even distant Atlantic economy the UK, in some ways, all seek to join. South Korea is the latest nation to declare interest.

Both Japan and South Korea are members of the China-led Regional Comprehensive Economic Partnership (RCEP), a multilateral pact that also includes Australia, Brunei, Cambodia, China, Indonesia, Laos, Malaysia, Myanmar, New Zealand, the Philippines, Singapore, Thailand and Vietnam.

Donald Trump took the United States out of the Trans-Pacific Partnership, leaving Japan as the dominant voice. Photo: AFP / Brendan Smialowski

RCEP, which was signed into force in 2020, is far larger than TPP-11 in terms of both members and overall trade volume. However, trade specialists consider it a less stringent agreement than TPP-11, ergo its benefits will likely be less, or will take longer to realize.

Spanner in the works

After the US dropped out of the original TPP, Tokyo has taken on the key role in promoting TPP-11 as its largest economy. While all 11 members must agree to the admission of a new member, Japan arguably has the biggest voice.

These factors could derail Seoul’s ambitions to join TPP-11, given how bad relations are with Tokyo.

Anti-Japanese feeling has long been a force in South Korea, sparked by intense local animosity toward Japan’s colonization of the peninsula from 1910-1945, as well as a territorial dispute in the Sea of Japan – which Koreans call the East Sea. But tensions peaked after President Moon Jae-in took office in 2017.

Under Moon, Seoul unilaterally quashed an agreement to settle the highly emotive issue of World War II “comfort women.” Then, South Korean courts seized Japanese companies’ assets in a move to compensate colonial-era forced laborers.

Tokyo was angry about Seoul’s unilateral abrogation of the 2015 comfort women deal between then-president Park Geun-hye and then-prime Minister Shinzo Abe. Under it, Abe offered his “most sincere apologies” and paid state compensation in a move to resolve the issue “finally and irreversibly.”

South Korean President Moon Jae-in’s peace offerings have been largely ignored in Japan. Photo: AFP / Handout / The Blue House

And Tokyo was furious about Korean court judgments, which it said obviated a 1965 agreement under which Japan had paid hundreds of millions of dollars in compensation and soft loans as redress for its colonization of the peninsula, enabling the opening of diplomatic relations.

In 2019, Tokyo imposed strengthened regulations on the export of key materials required by South Korean semiconductor manufacturers and removed the country from its “white list” of favored trade partners. Seoul replied in kind, and citizens launched street protests and a consumer boycott of Japanese products.

Moon has since turned more dovish. He said he was “perplexed” at yet another domestic court judgment that favored comfort women, and offered to reset relations with previous prime minister Yoshihide Suga and with current Prime Minister Fumio Kishida.  

Kishida was Japan’s foreign minister at the time of the Abe-Park comfort women deal.

However, Moon’s peace offerings have been largely ignored in Japan, which first demands a withdrawal of the court cases. Seoul responds that there is no constitutional mechanism by which politicians can interfere in judicial decisions.

This leaves Seoul-Tokyo relations teetering. There are hopes, in some quarters, of an upgrade after the March 9, 2022, presidential election, after which Moon leaves office.