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U.S., Japan Relations Rocky as Envoys Tangle

May 23, 1995

BRUSSELS, Belgium (AP) _ Keeping a hard line against Japan, U.S. Trade Representative Mickey Kantor has pledged to carry through with threatened sanctions and forecasting no improvement in relations.

Washington and Tokyo are ``not even close to agreement″ on trade in autos and auto parts, Kantor told the American Chamber of Commerce in Belgium on Monday.

``We will bring sanctions against the Japanese government if by June 28 there is no agreement,″ he added.

Kantor, who was in Brussels seeking European Union support for Washington’s position, he found himself in a tangle with Japan’s envoy to the EU, Tomohiko Kobayashi.

Kobayashi confronted Kantor during a press conference, saying, ``If the Americans think that once again at the very last moment the Japanese will give in, they are wrong, completely wrong.″

Frustrated by what it maintains is a closed market for U.S. autos in Japan, Washington announced last week it would slap a 100 percent import duty on $6 billion of Japan’s most popular luxury cars. Import taxes on those autos currently stand at 2.5 percent.

The EU, led by its trade chief Sir Leon Brittan, called the action illegal under world trading rules and accused Washington of undermining the infant World Trade Organization.

Kantor, who discussed the U.S.-Japan dispute with Brittan here, refused to comment on their private meeting. But Brittan spokesman Peter Guilford said the EU stance had not changed.

``Our primary role is upholding the credibility and strength of the multilateral trading system ... at a time when U.S. moves may threaten it,″ Guilford told reporters.

Kantor repeatedly stressed Washington’s desire to see the WTO enhanced and improved.

In addition to sanctions against Tokyo, he said, ``We’re bringing a case to the WTO. That’s strengthening the system.″

The sanctions, he said, are levied at practices not covered by WTO rules. In the absence of WTO rules, every member may pursue its own national laws.

Kobayashi threatened that Tokyo could follow suit. ``We will be considering very seriously our counter-retaliation measures,″ he told reporters.

``There are many areas in which the U.S. industry can be hit,″ he said, citing Japan’s high imports of American agricultural and hi-tech products.

However, he added, ``before coming to that stage we still have room for calm discussion.″

In Geneva, meanwhile, U.S. Commerce Secretary Ron Brown said Monday that the United States would abide by WTO rulings.

``We’re going to follow the rules and regulations and guidelines of the WTO,″ Brown told reporters. ``That’s why we are signatories.″

But he added that the administration must always enforce U.S. trade laws.

``It would be irresponsible for any administration to sit on its hands and do nothing in the face of a $60 billion and growing trade deficit with a single country,″ Brown said. ``Autos and auto parts represent two-thirds of the trade deficit.″

He added that he found it ``a little disingenuous″ for the European Union to criticize the United States for its policies toward Japan when the EU already has a quota system to restrict the number of Japanese car imports.

Kantor said he had no scheduled meetings with his Japanese counterparts during the ministerial meeting of the Organization for Economic Cooperation and Development in Paris starting Tuesday.

Ryutaro Hashimoto, Japan’s chief trade official, will also be in Paris.

Kantor indicated that any initiative for a meeting would have to come from Hashimoto, adding, ``I think the Japanese ministers know my phone number.″

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