Amadeusz Juskowiak

Japan us set to begin highlevel trade talks

Japan and the US Kick off toplevel trade talks tomorrow amid signs officials from both sides are growing increasingly irritated with each other

The talks held annually at subcabinet level to review the whole gamut of USJapan economic relations will pave the way for American Secretary of State George Schultzs one day stopover here at endweek on his way home from China

Faced with growing Congressional protectionist pressure the US Administration is pressing Japan for speedy action to reduce its still huge trade surplus US Officials said

We appreciate their frustration a senior Japanese government official said But we are also frustrated

The official said the 40 pct rise of the yen over the last 18 months has hit Japan hard forcing exporters to slash spending and lay off workers to make up for lost sales abroad That has not yet shown up in dollarbased statistics on trade but it will he said

He said the US Administration was ignoring the progress that has been made and instead emphasizing the problems that remain when it talks with Congress

It would only take five minutes to list their accomplishments a senior US Official replied

The talks begin tomorrow with highlevel discussions on the economic structures of both countries and how they affect the bilateral trade imbalance which last year amounted to 5148 billion dlrs in Japans favour

On the following two days the topics will range from multilateral trade talks under the auspices of the General Agreement on Tariffs and Trade GATT to such bilateral trade problems as super computers

The structural talks are intended to be freewheeling discussions among senior officials Tomorrows topics include savings and investment issues such as consumer credit and housing and the implications of government budget deficits

These talks come at a particularly delicate time for the Japanese government which is facing increasing domestic pressure to abandon its tightfisted fiscal policy and stimulate the sagging economy by spending more

Some US Officials complained Japan has no intention of boosting domestic demand and imports as Washington wants

Japanese officials in turn pointed the finger at the huge US Budget deficit as one of the main culprits for the trade imbalance That budget deficit has meant that the US Is buying more imports

Japan seems particularly peeved at being singled in a draft trade bill before the Senate as a nation following adverserial trade practices It condemns Japan without due process one Japanese official said

That reference spoils what is otherwise a wellthoughtout bill introduced by Democratic Senator Lloyd Bentsen he said

Japan is also not totally happy with the administrations trade bill particularly its proposal to establish reciprocal access to foreign markets as one criteria for retaliatory trade action by the US Officials said

Nevertheless Japanese officials said they remain in a weak bargaining position especially with the threat of a trade bill overhanging them

We have no leverage one official admitted

As a result Tokyo is striving to meet US Complaints about its trade practices in a variety of fields including super computers

The US Is pressing for greater access to the Japanese super computer market

The Japanese government has sent a long questionnaire to public institutions like universities which buy the sophisticated machines in hopes of eventually setting up informal bidding procedures easily understood by all potential sellers officials said

REUTER