Should Japan's Relation To Globalization?

Japan is trying to revitalize its economy with prime minister Shinzo Abe. His strategic economic policy is named “Abenomics”. In relation to globalization, Trans-Pacific Partnership (TPP) is a key for the success of Abenomics policy’s growth strategy. TPP is an ambitious free trade agreement between 12 countries, including Japan and the U.S., which aims at deepening economic ties and facilitate exchanges between those nations. TTP creates a large economic zone which covers about 40% of GDP in the world and population of about 800 million. It is important for Japanese government to adapt its economy to global trend (Cabinet, 2015).
To understand Japan’s policy in relation to globalization, we need to go back in time. Japan suffered a huge economic
It is described as the lost decades for the Japanese economy with very low growth rate (Horioka, 2006). While Japan was struggling to deal with domestic economy, globalization in trade increased in Europe and America. In Europe, the globalization occurred through the creation of the European Union (E.U.) in 1993 and the creation of single and common currency in 1999 (E.U., 2015). In America (U.S.), the signature of the North American Free Trade Agreement (NAFTA) between U.S., Canada and Mexico in 1994 contributes to globalization of the U.S. (U.S., 2015). Japan started to promote FTA in the 2000’s. The country signed the Economic Pacific Agreement (EPA) with 15 other nations including Singapore, Indonesia and Australia and under negotiations with eight countries. Japanese government uses the term “EPA” for its FTA, which aims not only trade liberalization, but also comprehensive economic cooperation in various fields such as investment, the movement of persons, the protection of intellectual property and the creation of rules for competition policy. (Ministry of foreign affairs, 2016, Fig.1). The Japan’s FTA strategy is to strengthen Japanese economic relationships with other countries. FTA benefits by the expansion of the Japanese
In 2004, Japanese government announced its basic policy on future economic partnership. In the policy, they describe the significance of FTA as (1) the complementary of multilateral trading system with WTO, (2) the promotion for structural reform of both Japan and partner countries, (3) the creation of advantageous condition for Japan’s diplomatic strategy. They also announce their three standards of their decisions for partner countries. The first is whether the partnership can create more advantageous condition for Japan. The second is whether Japan can secure economic profit as a whole country with the partnership. The third is whether the partnership is feasible to reach an agreement (Ministry of foreign affairs, 2004). Although being currently part of a large number of FTA, the expansion of Japanese market is still limited. The first reason is that the Japan’s FTA that were already concluded do not include key countries such as U.S. or E.U.. Indeed, the FTA coverage ratio (country coverage in terms of trade) of Japan is low: less than 20% which is half of the U.S. FTA coverage ratio (Fig. 2) (Ministry