John Bozzella representing the Association of Global Automakers, Inc. and Here For America testiified before the Trade Policy Staff Committee (TPSC) on a United States-Japan Trade Agreement. See attachment for full remarks.

The testimony highlights five key issues the Administration should consider as it begins the negotiation of a U.S.-Japan Trade Agreement.

  1. All vehicle tariffs should be eliminated at the earliest opportunity.  While our member companies have U.S.-produced products that compete in the U.S. market, immediate duty-free treatment of autos and auto parts would benefit all U.S. automotive producers, facilitate U.S.-Japan trade, enhance the competitiveness of U.S.-made motor vehicles, and benefit workers – and, ultimately, consumers – in the United States and Japan.
     
  2. As with other trade agreements, there may be an interest in including a rule of origin for automobiles as part of any tariff concession included in a U.S.-Japan trade agreement.  Should negotiators pursue such a rule, we believe it should be balanced, flexible and consistent with the tariff benefits obtained. Second, a U.S.-Japan Trade Agreement should embrace global harmonization for future automotive standards and regulations and that both countries should work through global bodies like the United Nations’ Working Party 29, to the greatest extent possible. 
     
  3. In today’s world a constant stream of data flows seamlessly across national borders.  It is therefore essential to have clear, consistent rules in place that allow for the unimpeded flow of data.  We therefore encourage the inclusion of provisions that prohibit the imposition of localization requirements as well as language to promote e-commerce.
     
  4. A U.S.-Japan Trade Agreement should include customs and facilitation provisions that mirror those in recent U.S. free trade agreements such as the newly signed United States-Mexico-Canada Agreement and U.S.-Korea Free Trade Agreement.  
     
  5. Currency is an international issue more properly addressed in a multilateral context, such as the G-7 or G-20, rather than in a bilateral or regional trade agreement.  If currency provisions are included in the U.S.-Japan agreement, those disciplines should not restrict U.S. policy options or preempt multilateral treatment of the issue.