This month's featured article
How will the TPP Change the Japanese Economy?
TODO YasuyukiFaculty Fellow, RIETI
Now that a broad agreement has finally been reached on the Trans-Pacific Partnership (TPP), can we expect it to accelerate Japan's economic growth? In March 2013, I wrote an article "Estimating the TPP's Expected Growth Effects" for the RIETI website. In it, I argued that the TPP would raise Japan's per capita gross domestic product (GDP) growth rate by about 1.5 percentage points. This estimate was rather high compared to the government's preliminary calculations in 2013, but if my forecast is correct, the enactment of the TPP would enable Japan to easily meet the Shinzo Abe administration's nominal GDP goal of 600 trillion yen.
The reason we can expect such a prominent growth effect from the TPP is that, in addition to deregulation of trade in goods, the deregulation of trade in services (retail, finance, intellectual property, etc.) and foreign investment will have a major impact on the economy. Moreover, the further economic integration will bring more face-to-face communication across borders. Therefore, the TPP will be to contribute to perpetual economic growth by promoting innovation through fully utilizing outsiders' knowledge (refer to the link above for details).
To read the full text
http://www.rieti.go.jp/en/columns/s15_0012.html
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