International Business : Australia Skeptical About Tough U.S. Trade Stance With Japan

Even here, seemingly far away from the economic frictions between Washington and Tokyo, the Clinton Administration is finding that it cannot avoid listening to people worry about the impact of the aggressive American efforts to open up Japanese markets.

In two days of talks with Australian officials, Secretary of State Warren Christopher found himself repeatedly defending the Administration’s Japan policy and its tough trade stance.

In fact, the Administration’s efforts appear to have made Australians angrier at the United States than at Japan.

That may seem paradoxical, because U.S. officials have repeatedly emphasized that the changes in importing behavior that the Clinton Administration is seeking from Japan will benefit all countries, not just the United States.

“We think we’re doing God’s work in trying to open up Japan’s market for everybody, including Australia,” Winston Lord, assistant secretary of state for East Asia, quipped Tuesday.

Those words carry special resonance in Asia, a region of the world where the memories of missionaries are particularly strong and not always pleasant.

Despite these American assurances, some Australians, including high-level officials, are nervous that Japan will wind up buying more goods from America and less from Australia.

In other words, the argument goes, whatever American intentions may be, in the end Australia will be harmed: Japan won’t increase its overall level of imports from the world. Rather, Tokyo will seek to satisfy or mollify the United States by increasing Japanese imports from America and cutting back on its purchases from Australia.

Australian Trade Minister Bob McMullan said last weekend that the government of Prime Minister Paul Keating worries that the United States will open up the Japanese market “at our expense.”

“We understand why the U.S., like Australia and the rest of the world, supports the opening up of the Japanese market, but we don’t support anyone doing it in a unilateral or discriminatory way,” McMullan said.

One reason for Australia’s concern: Some of its most important export industries compete directly with U.S. companies in the Japanese market. Japan could, for example, buy more American beef and cut back on purchases from Australia. Australia also exports some auto parts to Japan, which could be affected by U.S. pressure to get Tokyo to agree to buy more American auto parts.

Such fears are heightened by Australia’s recent experience with American grain sales.

Both the United States and Australia are among the world’s leading wheat exporters. When the United States began subsidizing agricultural exports to help American farmers compete with similarly subsidized competitors from Europe, Australians found their wheat exports suffered.

It is possible that Australian fears are being encouraged by some Japanese. A Japanese academic official reportedly said here recently that any increases in Japan’s imports from the United States will come out of Japan’s purchases from Australia.

Japan is now Australia’s leading trading partner. The United States ranks No. 2 on the list, behind Japan, both as a market for Australian exports and as a supplier of goods to Australia.

Lord said American officials have been explaining to the Australian government “that our position has been somewhat distorted. Obviously, Japan is the closed market. We are the open market. Obviously, Japan is the one that is managing trade, not the United States. . . . We will make sure that any opening we can achieve benefits everyone, including Australia.”

He said Australia is such a close ally of the United States and that the two days of meetings between American and Australian government officials have been so harmonious that “there has to be some change of pace.”