Japan Threatens to Abandon Aviation Pact With U.S. : Trade: Tokyo says it will not accept an unfavorable Washington compromise, as the nations remain far apart in talks.

Japan warned the United States on Monday that it may consider abandoning an existing bilateral aviation pact and refuse to hold further negotiations in an effort to win more aviation rights.

“If we are forced to accept an unfavorable compromise, we may consider abandoning the present aviation agreement,” Japan’s vice transport minister, Minoru Toyoda, told a news conference.

He said he did not necessarily think Washington would go ahead with threatened sanctions over the dispute but that if it did, “we would have to reconsider the negotiations.”

Japan and the United States ended their latest round of aviation talks Saturday still far apart.

The American and Japanese transportation ministers are likely to meet this week in San Francisco to try to resolve their dispute over air cargo rights, U.S. officials said Monday.

They said the talks, following the breakdown of lower-level talks over the weekend in Tokyo, would be led by U.S. Transportation Secretary Federico Pena and Japanese Transport Minister Shizuka Kamie.

Air passenger and cargo transport between the two countries is governed by a bilateral agreement signed in 1952, which Tokyo wants rewritten, saying it does not reflect the current state of the aviation industry and is unfair to Japan’s carriers.

The long-simmering dispute has come to a head recently over Tokyo’s refusal to facilitate Federal Express Corp.’s plans for route extensions in Asia.

Washington has warned it will impose sanctions on cargo flights by Japan Airlines Co. and Nippon Cargo Airlines Co. unless Tokyo does so.

Toyoda said Japan will maintain its position whatever the result of nationwide elections Sunday to fill half the 252 seats of the upper house of the Parliament.

“Even with a change of Cabinet, our present position would not change,” he said.

Upper house elections typically generate less interest than those for the more powerful lower house, but they are being touted as a referendum on the viability of Socialist Prime Minister Tomiichi Murayama’s tripartite coalition.

Japan Airlines submitted a letter Friday to the U.S. Department of Transportation in which it said it would ask the Japanese government to abandon the current aviation pact if the United States imposes sanctions, an airline spokesman said. Nippon Cargo Airlines said it had already submitted a similar letter.

The Japan Airlines spokesman said that even if Japan abandoned the pact, the current state of air passenger and cargo business would continue until a new arrangement is made.

He said Thailand and France had already abandoned their respective aviation agreements with the United States.