A Japanese flag flutters in front of a shipping container area at a port in Tokyo, Japan.

Commentary Type

Essential security interests and the future of the world trade order including Japan’s potential role

Photo Credit: REUTERS/Yuriko Nakao

Prepared remarks delivered at the 2024 CJEB Annual Tokyo Conference "Navigating Global Challenges: AI, Innovation, Monetary Policy, and Trade," Columbia University Business School, Center on Japanese Economy and Business



The Global Trade Order (GTO) has changed dramatically since 2016 as President Obama was ending his second term as American president.  Essential security interests now dominate US international economic policy.  They are at the heart of a self-centered US trade policy. The new policy is very much shaped by challenges posed by China and by a retrenchment in US international economic policy in reaction to a more globalized world.

Japan's international economic policy interests require consequent adjustments in its policies.  It should take an even more proactive role in maintaining and improving the Global Trade Order.  Japan has a positive record in collaborating with other countries to maintain and improve trading relations.  As the Trump administration withdrew from the Trans-Pacific Partnership (TPP) as it came into office, Japan took the initiative to save the TPP (slightly restructured as the Comprehensive and Progressive Trans-Pacific Partnership, the CPTPP). Under Prime Minister Abe's leadership, it championed ecommerce in international trade arrangements.  Japan is one of three co-convenors of the WTO ecommerce plurilateral (a Joint Statement Initiative (JSI)).  For its part, the US shows no sign of being interested in rejoining TPP and has backtracked from its support for an open digital world economy.

Japan straddles the geo-economic divide: joining RCEP, a trilateral investment agreement (Korea, Japan, China) as well as concluding an initial agreement to support the US-Japan trade relationship, in 2020 concluding the US-Japan Trade Agreement (USJTA).  It has entered into a critical minerals agreement with the US and joins the US in sanctions and export controls.

Japan is an important actor in improving the world trading system, working with others to preserve an open and rules-based World Trade Order.

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