Japan

Mr. Abe's long-cherished objectives of constitutional revision, embrace of collective defense, and — in the run up to this election — his self-cultivated image as someone capable of taking a tough stance with China on the territorial dispute, does create concern among Japan's neighbors...But the newly elected prime minister also understands that despite the landslide victory of his party, the LDP does not enjoy widespread popular support.

[Leadership change in East Asia] creates a great potential for change. New leaders say things during their leadership campaign, and when they take office, can pursue new policies. This creates new context for bilateral relations and relations among countries in East Asia. It's a source of uncertainty, but it's also a source of opportunity.

Regardless of whether President Obama is re-elected or Governor Romney wins the election, it is necessary for political stability [in Japan] to be restored at the top levels so that Japan can set forth clear policy measures and vision in order to maximize bilateral relations.

It is remarkable that the three largest economies in East Asia have not moved sooner in negotiating an FTA, but have instead developed their own FTA networks by negotiating with countries in Southeast Asia or outside the region. I think it is important to note that this is not because of lack of interest. For example, for several years now surveys of Japanese corporations have shown that the most attractive country to embark on an FTA negotiation is China. This is understandable given the large flows of investment and trade between the two countries, and the fact that the Japanese business community believes that an FTA can further enhance their conditions of operation in China.

But there are also important political considerations that have acted as roadblocks. FTAs are inter-governmental negotiations and when diplomatic relations are strained because of historical or territorial issues, the impetus for these official trade negotiations wanes.