Published online by Cambridge University Press: 08 January 2010
For Japan, the agreement signed with Mexico on September 18, 2004, signified a momentous step in political, if not economic, terms. The FTA is Japan's first agreement with an exporter of agricultural products – pork, citrus fruits, and avocados in the case of Mexico. NAFTA triggered a major shift, highly contested domestically, in Japan's foreign economic policy. Moreover, as described in chapter 7, it led Japan to the active pursuit of bilateral agreements with neighboring countries and beyond. Considering the modest volumes of bilateral trade, the choice of Mexico as partner in the second preferential trade agreement after over four decades of multilateralism is striking. Yet most of this trade is directly tied to FDI by Japanese firms, so that even relatively weak links sufficed to generate the momentum for a defensive PTA.
The coalitions of Japanese firms that supported the FTA correspond to those lobbying for the EU–Mexico FTA, but the case shows important differences in process and liberalization outcomes. Japanese investment in Mexico in general is smaller and narrowly concentrated in fewer industries. Electronics firms were particularly hurt by the abolition of the maquiladora benefits and lobbied actively. Most importantly, without a precedent of preferential trade agreements, Japanese firms first exhausted all possibilities of obtaining tariff relief from Mexico before turning to their own government for help.
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