 Hello everybody please I'd invite you to get coffee refreshments it's going to be available throughout the morning but we do want to get started this is this is I think our sixth or seventh sixth sixth conference that we have done jointly with Jettro I always look forward to it I think it's one of those things where you correct one of our shortcomings in Washington you know we're a big and complex and sophisticated country but when it comes to Washington we're a one trick pony you know we only can do one thing at a time and right now the only thing on people's mind is Libya you know and we can't decide if we're going to do a no-fly zone over Libya we're gonna spend days on this you know I mean and that's Washington we we tend to whatever is burning white hot in the inbox that morning that becomes our entire focus and and of course and I was talking to one of our what our panelists Lynn Hudson she said you know there's a difference between responsiveness and having a strategy you know reaction is not a strategy and we tend to spend too much of the public dynamic of Washington simply in reaction you know and what we really need to do is to invert our thinking and make it spend more of our time on strategy let me just use a little analogy I when I when I first went to DoD a friend of mine said let's imagine that you've got you've got four inboxes on your desk one is for urgent and important one inbox is for non urgent but important one is for non urgent or is for important but not urgent one is for non important non urgent which of those four boxes would you go to first in the morning when you walk in the door I said well of course you would go to the urgent important and he said no he said when you do that you have lost all the time to react into plan you should go to the important but not urgent every morning you know you ought to be looking at things where you have a chance to think about it and respond to it and shape it because if you only spend your time every morning going to the urgent important box you don't have any flexibility you know that's kind of where we are in Washington perpetually you know and what this conference is about is the important but not urgent okay this gives us the chance for us to think out into the future about strategic developments and say how does this what does this mean for us how important is this where is this going and I I really congratulate Jettro for having the foresight and the vision to make this part of their mission on behalf of Japan and reaching out and helping us along the way this is a very important partnership for us to be thinking through what is the strategic dimension that we want to start to cultivate that's important for all of us in the greater Pacific Eurasian region we had an interesting conversation last night about the Trans-Pacific Partnership you know this is part it's unresolved business it's important business it's not clear where it's going where should this take us these are the kinds of important non-urgent conversations that we need to have in Washington and so I look forward to this day very much and it's going to be an interesting day I especially want to welcome to Washington again Yasuo Hayashi he's a great friend we've had a chance to work with him now for a number of years he of course came to Jettro after a remarkable career he both is a student at University of Tokyo and at Oxford and then had a very distinguished career in METI has been in the private sector and then they just drug him back in he's got to help probably not the easiest time to have been brought into government Hayashi San I mean you know when the new government came to power in Tokyo and wanted to go after the bureaucrats I think Jettro was one of the high ones on their target list and yet I think it took them a while to prove out the value of Jettro to Japan and and today it's going to be a value to all of us and so we welcome you to Washington Hayashi San thank you for your leadership let me invite you to the stage to get this conference started for real thank you very much ladies and gentlemen good morning ladies and gentlemen it is very true that they I came back from the private sector to the governmental organization about four years ago and I didn't realize the position is so tough particularly the relation between government and our organization is what I have never expected this sort of tough job but anyway it's a really comfort and ease of mind to be able to come to Washington every year and to be able to discuss the important issues with you and they with CSIS friends and American friends together thank you very much indeed and also thank you John for your kind introduction and my name is Yasuo Hayashi Japan chairman of Japan External Trade Organization Jettro I'd like to express my sincere gratitude to all of you for taking time out of your busy schedule to attend the Jettro CSIS seminar today well let me extend my gratitude to Dr. Jono Hamure head of CSIS and also to Dr. Michael Green senior advisor in Japan chair as well as their colleagues at CSIS for their hard work in organizing this event we have been holding this annual seminar as John mentioned here in Washington six times in the past this is the sixth time since 2004 and this year marks the sixth annual event debate is accelerating on East Asian economic integration and the Trans Pacific Partnership or TPP so the timing of this year's seminar could not be more ideal today I would like to talk about four points first progress of Japan's EPA FTA's efforts and the second three achievements in East Asia Asian economic integration the third considerations about TPP and direction of East Asian economic integration and finally challenges facing the integration process and the importance of U.S. involvement now first of all I would like to report on the progress of Japan's EPA's FTA's as you can see in slide one Japan has EPA's in effect with ten countries and one region and recently signed an EPA with India and concluded negotiations with Peru we are also still in talks with Australia the Gulf Cooperation Council GCC and South Korea and examining the possibility of launching negotiations with other countries and regions such as ASEAN plus six ASEAN plus three are three way packed with China and South Korea and also deals with Mongolia and EU and quite recently with Canada this past November the Khan administration adopted its basic policy on comprehensive economic partnerships with a view to opening up the country and pioneering a new future the policy pledged to actively promote high-level economic partnerships with major trading powers in no way of inferior to global trends each year this event I report on the progress of economic integration in East Asia including Japan depending on the year I have had to rack my brains to come up with something worthy of reporting however this year I am pleased to be able to share with you three achievements oh this is I'm very happy to be able to report something productive the first is progress in TPP discussions following the cabinet decision to adopt the aforementioned basic policy on comprehensive economic partnership Japan held consultations with the United States in January of this year as well as discussions with our relevant countries it is expected that Japan will make a decision on whether or not to join TPP discussions by this June when prospects for the success of the WTO Doha around the remain uncertain and the number of high-level EPAs and FTAs being concluded between major trading powers is on the increase Japan views TPP as a vital means to keep the country's trade and investment environment competitive some argue that Japan's designation of agriculture products as sensitive items prevents it from making progress in negotiations I believe that if each negotiations partner took pragmatic pragmatic approach in this respect rather than an all-or-nothing one it would surely help advance negotiations it is true as Michael said yesterday last yesterday evening at dinner time there are many oppositions actually among politicians he mentioned 75 positions are against but I think the right of negotiations right of conclude the treaty is in the hands of the government the once government concludes the negotiations it's very difficult for politicians to vote against the treaty so I am very optimistic to the conclusion one if the government or any government I can say any government can government well conclude the negotiations I think it's quite possible that we can get into negotiations and can reach an agreement and the well it may take some time but I'm hopeful Japan is still the world's largest importer of agriculture products and some developed economies in the united states and some EU countries provide financial support to their agricultural sectors to boost international competitiveness it's well known in this context I believe that implementation of appropriate structural reforms with appropriate support will provide a platform for the japanese agricultural sector to survive international competition in the global market at least for some agricultural items at a world economic forum meeting in Davos this past january prime minister can deliver a special address in his presentation he suggested that it is compatible to promote economic partnership and revitalize agriculture at the same time as an example he referred to the positive feedback from attendees of the japan night in Davos 2011 which introduced japanese foods well general sponsor this a healthy and delicious were the common remarks from guests which to the prime minister demonstrated the competitiveness of japanese foods I think even in the united states japanese foods are very popular I recognize this in new york the second achievement I would like to discuss is increased membership at the east asia summit amid china's growing presence especially in the asian region it was agreed that the united states and russia would join the east asia summit from 2011 the summit members that is the asian plus six countries decided to welcome the new members and to proceed with various initiatives they had undertaken with sepia sepia the comprehensive economic partnership for east asia an area economic research instituted for asian in east asia this was also established by the initiative of japan and jatro and metis well this is this organization is the equivalent asian version of oecd so this was established within the framework of asian plus six and for the third achievement various frameworks initiatives have been launched with a focus on asian these include the so-called sepia of asian plus six and if the ea fta of asian plus three which aims at integrating and in strengthening the fta haven't spoke network among asians six fta partners including japan these initiatives were upgraded two years ago to become intergovernmental projects and are now under consideration well i mentioned this because jatro always uh you know asked by the government to lay the path for this integration process and we have been working very hard and i we were at east that government took up very recently in these intergovernmental discussions they cited infrastructure development as an essential factor for east asian growth at the east asian summit in also about 2010 area the oecd the asian version of oecd presented its comprehensive asia development plan in response to the intergovernmental discussions under this plan some 700 hard infrastructure projects worth 400 billion dollars need to be carried out both japan and the united states should be capable of promoting development throughout the whole of asia and thereby enhance the economy of the entire region i would like to touch upon tpp and the east asian economic integration here to facilitate our discussion i would like to clarify the framework of tpp and the direction of economic integration in asia i understand that some in the united states are skeptical about the promotion of economic integration in asia without the involvement of the united states due to the due to concern possibly over china on the other hand in asia especially in asian and china some voice their suspicion over the tpp framework saying it is for the developed countries in the pacific region and some say maybe it will uh it will be an organization to you know separate china out of the framework and may hold back asia's economic integration by dividing asia i believe that both views are misunderstandings the purpose of frameworks for economic partnership agreements in asia is to redress intra regional disparities abolish trade and investment barriers and facilitate trade and infrastructure development of the region they help asia maintain its position as an as an engine of growth in the world and ensure that it can make its contribution to the development of the global economy we have reached a stage where it is inevitable to institutionalize east asia's framework for economic integration which has evolved on a de facto basis at the moment discussions over fta's are proceeding on an individual basis between asian plus one countries which is already complete asian plus one is now complete and between china and taiwan china and taiwan aqua and between china and south korea and between japan and south korea the overlap of these individual frameworks cynically referred to as a noodle bowls has reached the levels administratively uncontrollable this is why a unified regional regional framework is necessary and discussions on this are inevitable sepia asian plus six and ifta asian plus three are examples of such unifying frameworks asian and china need not regard tpp as an inhibiting factor for asia's development on the contrary economic integration in asia will be achieved through tpp without such a region wide scheme it will be impossible to establish anything that has a real effect tpp will merely be a first step in the right direction and as such it should be regarded as a milestone for a wider economic partnership at the last apek meeting in yokohama it was agreed that concrete steps should be taken to bring reality to the vision to create free trade area of the asia pacific fta ap it is declared in the apek yokohama vision that an fta ap would be the goal for apek and that any existing frameworks should be step stepping stones to achieve it or it may take some time but uh well this is the final goal for the apek countries to aim for this is why the region has discussed on many occasions strategies to promote liberalization and facilitation of trade and investment on an apek-wide basis too much skepticism will be of no use regional economic integration can be achieved only through mutual trust and by promoting economic cooperation here we should look to a classic japanese saying of course the flow of river well you can say it integration process is ceaseless and its water is never the same but lastly i would like to talk about the challenges of the integration process and the importance of us involvement first of all it is important to convince japan and the other east asian countries of the specific positive effects that economic integration will bring such as economic development etc in respect to the comprehensive asia development plan i mentioned before it would be difficult to persuade any one country to finance all the costs for infrastructure development projects using public funds or oda instead such projects need to be tackled jointly and or utilize public private partnerships ppp's against this background japanese and australian business groups organize a joint mission to india in july of last year the group made up of 70 representatives examined the status of the daily moon by industrial corridor project and other local infrastructure development projects the aim was to identify possible ways for the two countries to cooperate in india's ppp infrastructure market i understand that another joint mission will also be sent to indonesia in may likewise japan and the united states should consider undertaking such joint efforts in the area of infrastructure development well the uh other east asian countries need all these efforts as well the huge economic disparities that exist among the 10 asian nations should also be taken into account to ensure smooth integration i mentioned singapore's gdp per capita in is higher than that of japan at four forty three thousand dollars in 2010 and the last day i mentioned a hundred times more but seventy four times that of miamas which is only miamas gdp per capita is five hundred eighty dollars this is why i as i have mentioned before we need to focus both on liberalization and development in our approach and take initiative for cooperation furthermore as shown in this graph some asian countries in particular vietnam and indonesia have seen their trade deficits soar in recent years this trend may hinder the efforts towards liberalization and the strategies to ensure development of supporting industries and increased international competitiveness have become urgent issue in these countries today we have the pleasure of welcoming doctor of all three tan vice president of the central institute for economic management cm i'm sure that the doctor tan will guide us on measures being undertaken in vietnam for several years now i have taken every opportunity including at this forum to stress the importance of u.s. involvement in east asian economic integration i'd like to stress it again particularly when very various frameworks are being discussed and put in place however as a positive step as one i took great pleasure in hearing about the united states was invited to attend the east asia summit this year as i mentioned to conclude i will just say that east asia needs a region wide framework that takes into account its incredible diversity in terms of political structures societies and also economic and financial aspects i hastily pursued framework that does not take these things into consideration may actually weaken or slow the economic integration process itself also as i pointed out there are many areas both at the government and the business levels where the united states and japan can and should cooperate this concludes my opening address thank you very much for your kind attention