Japanese give U.S. room to negotiate market access But Tokyo rejects 'targets' for imports

June 26, 1993|By John E. Woodruff | John E. Woodruff,Tokyo Bureau

TOKYO -- Tokyo's top trade bureaucrats left a bit of room yesterday for negotiations on a hotly contested demand that the Clinton administration has put at the core of its Japan policy.

In carefully phrased English sentences that stopped short of accepting anything, the officials said they were leaving room to work out statistical "indicators" to "measure progress" in opening Japan's markets to more imports. Close monitoring of such measurements is central to the Clinton administration's strategy in pressing for more access to Japan's markets.

At a news conference last night, the Japanese officials remained adamant that, even if such "indicators" were agreed on, they must never be used to establish "targets" that could "oblige Japanese consumers or companies to buy goods they don't want to buy."

But for the first time, instead of rejecting any use of "indicators" or "benchmarks," they said it would be important "to be very careful about the definition of a benchmark." Asked again, they said, "We have to clarify what is a benchmark."

In the arcane new language the Clinton trade strategy is creating, "indicator" or "benchmark" is used to mean a statistical measurement, such as the percentage of gross national product represented by a country's trade surplus, the annual value of new permits or licenses granted to foreign companies or the market share that a foreign industry holds in an importing country.

A "target" -- which Washington still demands and Tokyo still rejects -- would be a numerical level that the two sides agree an "indicator" ought to reach by an agreed-on time.

The Japanese officials at the news conference were Noboru Hatakeyama, the outgoing chief of international affairs at the powerful Ministry of International Trade and Industry, and his successor, Sozaburo Okamatsu.

Mr. Okamatsu will be one of three senior Japanese negotiators who will meet this weekend with a team from Washington. They will try to devise a "framework" for Japan-U.S. trade talks for the Clinton years. Prime Minister Kiichi Miyazawa and President Clinton agreed three months ago to have such a framework ready by the time they meet again 10 days from now at the Tokyo summit of leaders from the top industrial countries.

Earlier yesterday, Lawrence H. Summers, undersecretary of the Treasury, went before Japan's most powerful business association to press the Clinton administration case for Japan to adopt numerical "targets" for opening its markets to foreign imports.

Such targets are central to the administration's strategy in pushing Japan to reduce its $110-billion-a-year trade surplus with the rest of the world, about $50 billion of which is with the United States.

Mr. Summers, who was a highly regarded Harvard economist and World Bank development expert before joining the administration, pressed especially for Japan to reduce its trade surplus from well over 4 percent of gross national product to between 1 percent and 2 percent.

Such action, he said, would stimulate enough demand for imports to add "1 or 2 million jobs" to the rest of the world's payrolls.

He declined to estimate how many jobs such action might cost Japan. Instead, he argued that it is needed because unemployment exceeds 7 percent in the United States and 11 percent in much of Europe but is only about 2 percent in Japan.

Mr. Hatakeyama and Mr. Okamatsu rejected that plan as precisely the kind of "target" that Japan insists would amount to "managed trade."

Mr. Summers argued that the trade-surplus surplus levels Washington seeks are merely those that Japan has repeatedly promised to meet.

In the late 1980s and again in 1991, with Japan's trade surpluses running under 2 percent of GNP, Japanese governments promised the United States that they would reduce the surplus' share of GNP, Mr. Summers said.

Instead, Japanese companies' attempts to export their way out of recession have combined with recession-slowed Japanese demand for foreign imports to drive the ratio above 4 percent, he said.

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