Japan Seeks Urgent Cabinet Trade Talks : Negotiations: After two days of discussion, Japan says U.S. demands for easing the trade imbalance are too strong. The U.S. says Japan is not willing to do enough.

Foreign Minister Taro Nakayama today called for urgent Cabinet-level trade talks, saying U.S. demands at lower-level discussions on the U.S.-Japanese trade imbalance were stronger than expected.

American officials criticized Japanese negotiators in the talks, saying they would not go far enough in efforts to reduce Japan’s $49-billion trade surplus with the United States.

“We must say we find ourselves frustrated and concerned at this point,” Deputy U.S. Trade Representative Linn Williams told reporters after the two-day negotiating session ended today.

“We expected this meeting to be a substantial step forward. But what we heard is not enough to be effective, lasting or credible,” he said. “It was mainly a defense of the status quo with prospects of only minimal further action.”

Nakayama told reporters the American demands were “much severer” than Japanese officials had expected.

He called for an urgent meeting of top government officials, after Prime Minister Toshiki Kaifu names a new Cabinet next week, to clear up disagreements aired in bilateral talks at the sub-Cabinet level.

The Japanese side today was given a chance to critique U.S. plans for structural trade reform.

This round of trade talks--known as the Structural Impediments Initiative--was delayed from early January until after national parliamentary elections Sunday that kept the conservative Liberal Democratic Party in power.

Since the structural trade talks were launched in May, U.S. officials have pressed Japan for evidence of willingness to carry out wide-ranging reform to help reduce Japan’s trade surplus with the United States.

Today, it was the United States’ turn to explain what it is doing to change American practices that contribute to the imbalance. U.S. officials had said they would outline Washington’s plans to increase the low U.S. savings and investment rates and to bolster the competitiveness of American firms.

The U.S. timetable for these changes was unclear.

Japan says U.S. problems contributing to the trade imbalance include inadequate savings and investment, the short-term nature of U.S. corporate strategies, ineffective labor training and education and insufficient export promotion.

Japanese officials contend that many of the U.S. demands for change in their economy cannot be carried out as quickly as Washington hopes.

U.S. officials say Japan’s high savings and investment rates, its land policies, exclusionary business practices, inefficient retail distribution networks and pricing mechanisms all indirectly restrain trade.

In response to those complaints, the Japanese side on Thursday explained measures in a draft budget before Parliament to improve enforcement of anti-monopoly laws, to increase spending on such public infrastructure as roads and sewers and to reform the retail distribution system.

They also explained revisions of Japan’s land use law aimed at curbing real estate speculation and increasing the supply of available land in urban areas.