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Trade Frictions Aside, A Surprising Fact: Imports Are Rising

June 26, 1995

TOKYO (AP) _ With the United States firmly demanding Japan open its automotive markets, you might suppose imports in Japan were as rare as a skinny sumo wrestler.

That assumption would be wrong.

In fact, Japanese consumers last year purchased more goods from abroad _ nearly $275 billion worth _ than ever before.

That represents a 14 percent jump over 1993′s $240.7 billion in imports and is nearly 18 percent higher than 1992. Compared with 1986 levels, the dollar value of imports into Japan has more than doubled.

While some of the increase reflects the declining value of the dollar against the Japanese yen, which inflates more recent figures when converted into dollars, the data also show Japan is importing more from abroad and expanding the range of imported foreign products.

The surge is evident in places like Shinanoya, a fast-growing food and liquor store chain that almost exclusively sells foreign goods.

At the year-old store in Tokyo’s pricey Ginza district, manager Koichiro Tobe takes a look around the shelves _ tomato sauce from Ohio, French designer nail polish, garlic margarine from New Zealand _ and says business is booming.

``Customers are getting very picky about price,″ Tobe says. With the skyrocketing yen, which makes foreign products cheaper in Japan, now is a favorable time for imports, he added.

Most of Japan’s imports used to be food and other raw materials like oil, but that’s changing. Since 1991, manufactured goods have made up more than half of imports _ meaning the Japanese are buying more high value-added products like American computer software.

``If you look at the figures, you’d have to say it just isn’t true that Japan isn’t trying to import U.S. products,″ says Yoichi Nakagawa, an economist who watches imports at the Bank of Tokyo.

So what’s all the fighting about?

For one thing, U.S. trade negotiators say, Japanese exports have surged at a pace equal to imports. Thus, Japan’s trade surplus with the rest of the world has kept rising, hitting a record $121 billion last year.

U.S. officials say the import surge simply means Japan is finally approaching the level of imports it should have reached years ago were it not for government red tape and exclusionary trade practices.

Cars and car parts, the subject of the U.S.-Japan trade showdown this week in Geneva, have been made into Exhibit A for that contention.

Japan’s imports of both are rising rapidly, but from such a small base the increases haven’t amounted to much. The United States sold just $3.5 billion of autos and auto parts to Japan in 1994, and its shortfall in that area accounts for more than half the U.S. trade deficit with Japan.

The Clinton administration has vowed to slap sanctions on Japanese-made luxury cars Wednesday unless Japan gives assurances imports from the United States will rise more quickly. Washington’s basic complaints have won sympathy from Japan’s other trading partners.

But just as the United States prepares to hit Japan with its biggest sanctions ever, the stirrings of change have become clearer than ever in Tokyo.

The rise of the yen against the dollar, more than 15 percent since the beginning of this year, has made American goods so attractive many importers don’t even bother repackaging them for Japan.

Many Tokyo stores have begun selling American snack foods such as potato chips, soft drinks, cookies and chocolate bars exactly as they are found in the United States _ previously an unthinkable practice. The only difference is a makeshift sticker giving the ingredients in Japanese.

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