IT IS hard to imagine Japanese Prime Minister Yoshihiko Noda taking to the radio airwaves today to stare down the sceptics and declare that this is his country's banana republic moment.
That is not the way decisions are made in Japan, but Noda needs to use his diminishing political capital to adopt the cathartic approach to economic reform that Paul Keating used in 1986 and end the stranglehold that ageing farmers have over the country's future.
With time running out before the Asia Pacific Economic Co-operation group summit at the weekend, Japanese government representatives have suggested that the Prime Minister will announce whether his country will join the US-backed Trans-Pacific Partnership (TPP) before a parliamentary session tomorrow, reports The Australian Financial Review.
TPP amounts to much more than the US seizing on what was a relatively insignificant agreement among four small, free-trading countries – Singapore, Chile, Brunei and New Zealand – to grandstand at the APEC summit.
Big questions remain about whether the TPP represents the best path forward in the decades-old push for regional free trade. There are suspicions that Obama wants a pre-election campaign initiative regardless of the exemptions and imperfections it might contain.
This presents Australia with a difficult strategic choice: reconciling a quick agreement at APEC that doesn't include some of our largest Asian trading partners with Trade Minister Craig Emerson's push to revive the Doha multilateral trade round with a series of sectoral negotiations.
But with the Doha talks on the rocks, the summit provides Noda with a political lever with which to deal with the corrosive situation in Japan, where farmers who represent less than 2 per cent of the population and annual output can prevent trade liberalisation that would benefit the rest of the economy.
Some agriculture protectionists are arguing that Noda should ignore the uncertain procedures and outcomes from the TPP and instead focus on the more familiar prospect of a trade deal with Australia. But the absence of any summit-style deadline for reviving the Australian talks does not provide much optimism about that strategy bearing fruit – or beef, for that matter.
Others say Japan would set back its reconstruction by embarking on a bitter political debate about the TPP at this stage and probably also retard any prospect of the TPP becoming a model, open-trade agreement because its presence would add weight to the push for exemptions.
Foreign Minister Kevin Rudd neatly underlined in a speech to the Australia Japan Conference last week why Japan still matters to Australia: it's a bigger investment partner than China and a bigger trading partner than the US.
But discussions at the semi-annual off-the-record conference revealed a little-appreciated new fault line in a relationship that has always suffered from the fact that the resource trade is vitally important in overall economic terms but little appreciated by the broad populace.
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