Japan Offers to Continue Trade Talks
A high-level White House negotiating team told President Reagan on Monday that Japan has offered “new commitments” to open its markets to U.S. products, but Senate committee aides found preliminary briefings from the negotiators to be “disappointing.”
White House spokesman Larry Speakes declined to give details of the Japanese commitments, explaining that Reagan will evaluate the situation after his negotiators brief the Cabinet, key members of Congress and business executives during the next few days.
But Speakes conceded that “we stand basically where we were last week” in the high-priority negotiations on opening Japan’s markets to U.S. telecommunications equipment. The overall U.S. trade deficit with Japan was $37 billion last year.
Will ‘Keep Talking’
Reagan’s negotiators, National Security Council staff member Gaston Sigur and Under Secretary of Commerce Lionel H. Olmer, returning from talks in Tokyo, told the President and other top Administration officials that Japan “agreed to keep talking,” according to Speakes. “The President welcomes this development,” he said.
Reports from Tokyo indicated that Prime Minister Yasuhiro Nakasone offered to keep negotiating for 60 days on whether the Japanese will allow U.S. companies to freely sell their products to Nippon Telephone & Telegraph, the Japanese phone monopoly that on Monday became a private company. Sigur and Olmer warned Nakasone in Tokyo on Sunday that Congress would retaliate against Japanese exports to the United States unless Japan opens its telecommunications market.
Although formal congressional briefings on the new Japanese trade offer are to take place later this week, Senate Finance Committee aides said Monday that early indications, based on informal briefings, are “not good.”
Insufficient Movement
Olmer reportedly told key committee members that the concessions do not go very far toward satisfying conditions that the Administration believes are fundamental to a successful telecommunications agreement.
After a preliminary telephone briefing by Olmer, Sen. John C. Danforth (R-Mo.) said he is “very skeptical of the likelihood that the Japanese government will at some future date deliver on concessions made at the negotiating table.”
Aides said Olmer made no effort to portray Nakasone’s commitments as negotiating concessions that could be translated into “actual sales by actual American companies.”
Normally a moderate free-trader, Danforth last week sponsored a harsh but non-binding resolution calling on the Administration to retaliate against Japan’s exports to the United States if its markets are not opened to American products. The resolution sailed through the Senate last Thursday, 92-0, and Danforth said he will press today for committee approval of a bill to make his resolution binding.
The telecommunications negotiations appeared to have ended last week in a standoff, with Olmer conceding in previous testimony before a House subcommittee that, of nine key issues under negotiation, the United States failed to achieve results in five.
Severe Quality Standards
Most important, Olmer said, he failed to persuade Japanese negotiators to abandon a complex structure of some 30 qualitative standards for imported telecommunications equipment in favor of a single measure: whether the equipment would harm the nation’s communications network.
Such a single standard applies in the United States, and Olmer warned last week that failure to win a substantial Japanese concession on this point would “nullify” concessions on other issues. The Japanese have made some concessions on easing their regulatory procedures.
At present, the Administration appears likely to play for time, in the hope that some congressional enthusiasm for trade protection may abate during the 10-day Easter recess that begins Thursday. It is also possible that the Japanese offer to keep the telecommunications talks open for 60 days will put off a serious congressional move to restrict trade until after the economic summit meeting scheduled for Bonn early next month--a meeting at which Reagan, supported by Nakasone, is expected to push for a new round of international negotiations on reducing trade barriers.
Some Restraint Seen
And there are a few signs of congressional restraint on the issue. Rep. Sam Gibbons (D-Fla.), chairman of the House Ways and Means subcommittee on trade, urged Congress to avoid action to restrict imports from Japan, saying, “It’s easy to flail the foreigner.”
The business community is awaiting the Administration’s latest reports from Japan with a skeptical outlook.
“From our point of view, the real test will be actual sales,” said William Krist of the American Electronics Assn. “Companies can go over and win contracts in Taiwan and Korea but don’t have a chance in Japan. We want to hear from the companies that they now have a chance to compete in Japan.”
In the past, Krist said, “one barrier to trade was removed and another would crop up immediately. The test now is whether companies can sell, and we won’t know that for awhile.”
