U.S., Japan Report No Progress in Geneva Talks : Trade: Prospects for resolving the conflict before the sanctions deadline appear slim.

A day of talks on Washington’s threat to impose 100% tariffs on 13 Japanese luxury car models ended Monday with no sign of progress, and there appeared to be little prospect of movement before the June 28 deadline.

Staff-level representatives of the U.S. and Japanese governments met for a total of seven hours at World Trade Organization headquarters here. They emerged only to read brief statements reiterating their countries’ previously stated opposing positions.

No further bilateral talks are scheduled before the tariff deadline. However, President Clinton and Japanese Prime Minister Tomiichi Murayama are to meet Thursday afternoon, ahead of the two-day Group of Seven summit in Halifax, Nova Scotia.

U.S. Trade Representative Mickey Kantor and Japanese Trade Minister Ryutaro Hashimoto will also be at the summit.

But White House spokesman Mike McCurry reiterated Monday that the Administration doesn’t “expect any resolution of our trade and economic issues as a result of the meeting between the prime minister and the President.”

Meanwhile, the Japanese are balking at U.S. plans to hold more substantive bilateral talks next week in Washington after what were considered procedural talks in Geneva.

After Monday’s talks, Japan’s ambassador to the WTO, Minoru Endo, told reporters that his government was ready to resume broader negotiations on auto and auto parts trade if Washington would first step back from its threatened tariffs and abandon its attempts to achieve “numerical targets” of percentages of the Japanese auto parts market.

“We believe that this change of position on the part of the United States would allow us both to move forward,” Endo said.

The tariffs would apply retroactively to all designated cars that landed in the United States after May 20. Japan has been arguing that the unilateral tariffs, which would affect nearly $6 billion worth of cars, are “a clear violation” of international trading rules.

But Andrew Stoler, deputy permanent U.S. trade representative in Geneva, said the U.S. delegation had told the Japanese that the looming sanctions “are in full compliance with our obligations as a member of the World Trade Organization.”

As U.S. trade officials have done in the past, Stoler blamed “Japan’s unwillingness to open its markets” in the automotive sector for provoking Washington to impose the tariffs.

Monday’s talks had been requested by Japan and were meant as a chance for Japanese officials to challenge the legality of the proposed tariffs. The meeting was not intended as a negotiating session on what Washington sees as the core issue: business practices in Japan that make it extremely difficult for outsiders to enter that country’s auto markets.

Under WTO procedures, Japan has 60 days, starting from May 17, to hold consultations with the United States on the tariff question. After that, Japan can ask the WTO to create an arbitration panel to work out the dispute.

U.S. delegates refused to answer questions after the talks. Japanese delegates would say only that they now had a better understanding of the American position and would “ponder” their options.

Endo affirmed that the mere threat of tariffs was “already seriously affecting exports” from Japan, and he said Japan remains eager to settle the dispute.