U.S.-Japan Trade Talks Make Progress, Go Into Extra Day

U.S. and Japanese officials began an unscheduled third day of talks today in hopes of completing a final report on the results of yearlong negotiations aimed at removing trade barriers.

Officials on both sides could not say when they might finish with the so-called Structural Impediments Initiative, which President Bush has made the centerpiece of his economic policy toward Japan.

“It’s difficult to say whether we will finish these talks” today, one U.S. official said. “We could finish while we are here in Tokyo, or we could finish later next week.”

Only 24 hours earlier, a U.S. official had said the sides were “not far apart.” But on Sunday, U.S. Trade Representative Carla Anderson Hills was quoted as saying in Washington that another round of negotiations might be needed.

A member of the U.S. delegation here appeared to discount this possibility. He cited as areas of “good progress” Japan’s promise to untangle its complicated goods-distribution system--a key U.S. demand--and a U.S. promise to reduce its budget deficit, something on which the Japanese have insisted.

Differences remain on a U.S. demand for more Japanese public works spending and on how the sides will fulfill reform promises.

Discussions that began at 9 a.m. Tuesday and continued into the night focused on Japan’s call for a reduction in the U.S. budget deficit. The Americans responded, one official said, by explaining that Bush plans to use a surplus in Social Security funds to lower the deficit and will try to revise the Gramm-Rudman-Hollings Act to require budget surpluses after 1993.

The United States, he said, will stand by a pledge that it made in an April interim report to eliminate its budget deficit by 1993.