Japan, Mexico Vow Closer Economic Ties

The leaders of Japan and Mexico pledged Tuesday to work closely to foster economic relations, underscoring Japan’s emerging role as a key player in Third World debt relief and environmental aid.

Prime Minister Toshiki Kaifu offered nothing new in the way of concrete assistance in his two-hour meeting with President Carlos Salinas de Gortari. But Japanese Foreign Ministry officials said the two leaders reviewed Japan’s recent commitment to ease the burden of Mexico’s $100-billion external debt and to help Mexico City fight its formidable air pollution.

Salinas welcomed the Japanese decision, which Kaifu disclosed in his meeting with President Bush last Friday, to speed the disbursement of $1.4 billion in loans to Mexico by January. This money is part of a $2.05-billion package offered by the Japan Export-Import Bank, which originally was to be paid out over three years. Mexico will use the funds in a program to package its debts so they can be broken into small enough shares for average investors.

Separately, Mexico has asked Japan to contribute $2 billion to a $3-billion program aimed at fighting air pollution in the capital and protecting the environment. But Japan, which has state-of-the-art pollution technology after cleansing the air of its industrial cities, has balked at committing a specific amount until Mexico clarifies which projects would be pursued.

Kaifu told Salinas a team of Japanese technical experts will return to Mexico in October to work out the details, the official said.

Kaifu arrived in Mexico on Monday during a 10-day North American tour, which he began just three weeks after taking office. He is scheduled to fly to Ottawa today for talks with Canadian Prime Minister Brian Mulroney before returning to Tokyo this weekend.

In his summit with Salinas, Kaifu also discussed the prospects for renewing a contract to import Mexican oil, officials said.

Trading Partner

Japan, Mexico’s second-largest trading partner after the United States, primarily because of oil transactions, currently buys 180,000 barrels of crude a day under a 10-year contract that expires at the end of the year. Kaifu told Salinas that Tokyo is likely to renew the deal at about the same volume.

However, he said it will be up to private Japanese interests to decide whether to accept the Mexican request for advanced credit, as it did 10 years ago during an oil shortage in the West. At that time, the Japanese side loaned $500 million to Mexico, mostly for use in an oil pipeline project.

Foreign Ministry officials billed Kaifu’s trip to Mexico, the first official visit by a Japanese prime minister in nine years, as a symbolic gesture of Japan’s new role as a global partner to the United States in security and economic affairs.

Kaifu proposed expanding the dialogue between the two countries away from purely economic issues to include high-level political discussions about regional issues such as the Central American peace process, according to the officials. The prime minister also expressed the desire to provide Japanese assistance for refugees in the region, they said.

Salinas, in turn, said he is keenly interested in ministerial talks on Pacific Rim development scheduled this fall in Canberra, Australia, and said he hopes Mexico might participate in such forums in the future.

Although Kaifu reportedly responded favorably, Japanese officials have been noncommittal to a Mexican request to join the Pacific Economic Cooperation Committee, the Tokyo-sponsored development consortium of 13 countries in the Asia Pacific region.

Salinas, who is sending his three sons to a newly established Japan-Mexico school here, has declared that Mexico must stake its future in the Pacific Rim and has aggressively courted Japanese investment with a relaxation in restrictions on foreign capital.