The Elusive China-Japan-South Korea Free Trade Agreement - Trans-Pacific Partnership (TPP), Global Trade, State-led Regionalism, GATT, WTO, Japanese Agricultural Interests, Sino-Japanese Relations

This excellent report has been professionally converted for accurate flowing-text e-book format reproduction. East Asia has become a major hub for global trade. At the center of this East Asian factory are three nations-China, Japan, and South Korea-which have benefited the most economically. Yet, despite transnational value chains and the trilateral political cooperation that binds these nations, they have yet to conclude a trilateral free trade agreement (FTA). Since 1999, the China-Japan-South Korea FTA has proved to be an elusive feat for these Northeast Asian neighbors. Historical and political animosities and popular mistrust seem to have a corrosive effect upon the trilateral relationship despite decades of political cooperation and economic interdependence. What explains the limited progress toward a China-Japan-South Korea FTA? This study tests four potential explanations for the trilateral FTA's current lack of progress: perceptions of the deal not being an economic priority, the power of influential domestic business interests negatively affected by the FTA, regional competition over China's growing domestic market, and regional political-historical animosities. Overall, this research concludes that Japan is the least willing participant to push for progress toward a trilateral FTA, and a lack of perception of the deal not being an economic priority is the strongest explanation.

Chapter II draws out the evolution of the China-Japan-South Korea FTA from 1999 onward within the context of both NEA economic regionalism and other competing mega-FTAs. The economic benefits and costs each country would incur if the trilateral FTA were successful are laid out in this chapter. Also, potential interest groups who particularly stands to win or lose in China, Japan, and South Korea from the trilateral FTA are identified. In addition, Chapter II provides a comparison of the benefits and costs of the trilateral FTA as compared to that of TPP and RCEP. Ultimately, these benefits and costs are conditional on the quality of the China-Japan-South Korea FTA. Chapters III-V provide the empirical evidence that support the potential explanations that affect Chinese, Japanese, and South Korean decision-making toward the trilateral FTA. Each of these chapters frames the potential explanations in terms of the specific actors and interest groups at work in these countries. As the evidence is presented, strengths and weakness are assessed in order to determine which explanation is the strongest for each country. Chapter VI reviews the strength of the empirical evidence from the previous chapters and provides regional implications of the potential success or failure of the trilateral FTA. In particular, implications for the U.S. role in the region are explored visa-vis NEA cooperation, and whether or not an exclusive trilateral FTA serves U.S. interests in the region.