The Domestic Political Economy of Japan's New Geoeconomic Strategy

Abstract Japan has long strived to acquire a more influential voice in trade negotiations but failed because of the lack of decisiveness rooted in the resistance from those who have vested interests. However, a series of domestic reforms undertaken since the 1990s have made it possible for Japan to play a leadership role in the new rulemaking of international trade. After the Trump administration withdrew the United States from the Trans-Pacific Partnership, Japan took the initiative to conclude a new agreement called the Comprehensive and Progressive Agreement for Trans-Pacific Partnership. How have domestic factors pushed Japan to step up as a new leader in the rulemaking of international trade? How have the economic rise of China and the relative decline of US hegemonic power impacted Japanese domestic politics and economics? What implications do Japan's new roles have for the security and prosperity of the Asia-Pacific region? By exploring empirical evidence drawn from five new books, we argue that the commitment to domestic economic reforms has enabled Japan to play a leadership role in the rulemaking of the international economic order.