U.S. and Japan Work on Interim Trade Accord : Pacific Rim: The Bush Administration hopes to make Tokyo ‘flesh out’ its April promises.

The United States and Japan began serious efforts Friday to iron out their differences over a high-level interim accord that the two countries signed in April to help ease their trade frictions, but the outcome of the spat remained in doubt.

At a meeting in San Francisco, Secretary of State James A. Baker III pointedly warned Japanese Foreign Minister Taro Nakayama that Japan must “flesh out” some of the promises it made in the April accord or risk reviving anti-Japanese sentiment in the United States.

It was not immediately clear whether the meeting between Baker and Nakayama would be enough to turn around lower-level talks, in which U.S. officials have charged that Japan has been “stonewalling” American demands that Tokyo spell out the concessions it made in April.

But participants in Friday’s session said the tone of the talks provided some optimism that top Japanese leaders are beginning to take U.S. demands more seriously and may begin moving to provide the details Washington wants.

The meeting marked the first Cabinet-level discussions between the two governments since the lower-level negotiations broke down two weeks ago. The negotiators are scheduled to meet again--presumably for the last time--June 25-26.

The accord, which contained the most sweeping pledges for economic restructuring negotiated by any two trading partners, involved a number of Japanese pledges, from significant deregulation of Tokyo’s goods-distribution system to promises of a crackdown on bid rigging by Japanese construction firms.

But the report clearly was intended as an interim step that would form the basis of a final report that the two sides would hammer out shortly before the annual seven-nation economic summit to be held July 9-11 in Houston.

Washington wants Japan to nail down several key concessions by providing specific numerical targets for Japanese pledges to boost government spending on public works projects and to increase penalties for violations of anti-monopoly laws--lest they be watered down in practice.

Until Friday, lower-level Japanese officials had flatly refused to move ahead on any of the points that U.S. negotiators had raised, contending in effect that the interim report initialed in April was sufficient and that no further measures would be needed.

But U.S. officials said the session Friday was devoid of any such posturing and that Nakayama had promised to carry the message back to top Japanese policy-makers--a signal that frequently means that an issue is about to be considered more seriously.

U.S. officials said Nakayama also took pains to assure the Administration that Japan did not intend to abandon efforts to reduce its balance of payments surplus with the United States, despite suggestions to that effect by some lower-level officials in Tokyo.

The suggestions, contained in a report published two weeks ago by the Japanese Finance Ministry, enraged senior Bush Administration policy-makers, who had spent months persuading Tokyo to make payment reduction its top goal.

U.S. officials said if the June 25-26 meetings do not produce any results, the Administration may have to intensify its pressure--possibly by involving President Bush directly in talks with Japanese Prime Minister Toshiki Kaifu.