Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: WEDNESDAY, March 30, 1994 TAG: 9403300165
SECTION: BUSINESS PAGE: B-8 EDITION: METRO
SOURCE: Associated Press
DATELINE: TOKYO LENGTH: Medium
U.S. Trade Representative Mickey Kantor rejected the proposal as a ``half-finished work'' that did not meet President Clinton's concerns.
Careful to say the United States was still hopeful Japan could meet its demands, Kantor said, ``We have reviewed these measures, and they do not meet the concerns the president raised on Feb. 11 during his meeting with Prime Minister [Morihiro] Hosokawa.''
Clinton could now try to force changes by imposing sanctions on Japanese products under the newly revived Super 301 provision of U.S. trade law. The first step toward that could come Thursday, when a U.S. report will detail foreign trade barriers.
Japan's government said it would spend the next three months on steps to cut bureaucratic red tape in 11 key areas where foreign companies say it is too difficult to enter the market, such as insurance, retailing, pharmaceuticals and food. But Japan said it would not decide until June on specifics of how to bring product regulations and standards more in line with world norms.
It also said plans should be ready by June to expand spending on public works and to extend a $56 billion tax cut past this year - both steps that Washington demanded, believing they would perk up Japan's economy and boost purchases of foreign goods.
Tokyo is hoping to break a six-week stalemate in talks with Washington over how to reduce Japan's $59 billion annual surplus in trade with the United States.
But Kantor said the proposal was not enough to renew talks.
``The package of measures is of limited substance and appears to be a half-finished work,'' he told reporters.
``We are not discouraged,'' he added. ``The government of Japan has described this as a first step, and we see it as a work in progress.''
He said Clinton talked to the prime minister before reviewing the proposal.
The language of the proposal gives a clue to its authors: Japan's powerful career bureaucrats.
U.S. officials and many Japanese have criticized the bureaucrats, accusing them of blocking reform of Japan's economy. Japanese officials dispute that, saying they recognize Japan's economy needs less government control and more freewheeling entrepreneurship to recover from a prolonged recession.
``We need to deregulate for the sake of our economy, or else it will lose its competitiveness,'' said Tatsuya Terazawa, deputy director of the Americas division.
The Japanese package did contain a few new specific steps. It included measures to make it easier for foreign companies to win government contracts, such as providing more advance information and improving complaint procedures.
Separately from the government action, two more Japanese car makers - Honda and Mazda - announced plans to buy more foreign parts, joining Nissan, Toyota and Mitsubishi in responding to U.S. calls for cutting the auto trade imbalance.
Japanese officials stressed their position that the government cannot guarantee targets like those announced by the car makers. A U.S. demand for numerical goals caused trade talks between Hosokawa and Clinton to break down Feb. 11.
However, in Tuesday's package, Japan did say it would gather sales volume and data on efforts by Japanese and foreign companies to boost sales of foreign cars and parts in Japan and ``take appropriate measures as necessary.'' It did not explain the measures.
by CNB