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US trade strain eases with Japan, but Europe poses growing problem

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THE amount of Japan-bashing in Washington is dying down. That's because it has become less justified. Over the years, Japan has lifted many of the government obstacles to imports. In this regard, it may not be much worse than the United States or the European Community.

Japanese business still colludes to keep out foreign goods and companies. Indeed, notes Harald Malmgren, a trade consultant in Washington, Japan's banks and insurance companies have become so financially powerful that the Ministry of Finance in Tokyo has less influence on their business practices than it did some years ago.

Despite Japanese business efforts to limit imports, they are growing. In July, imports from the United States surged 21.4 percent from the same month the year before. The European Community saw its exports to Japan grow 30.7 percent.

Notwithstanding, Japan's trade surplus grew 3.5 percent in July from the same month a year ago. But it was the first such rise in 15 months.

Another obstacle to imports is the Japanese distribution system. Prime Minister Noboru Takeshita has just appointed an advisory panel to look into the question of reforming the system, as promised at the Toronto economic summit in June.

At present, notes Wall Street economist Sam Nakagama, ``mom-and-pop'' stores serve as a kind of social security system and a buffer against unemployment in Japan. Their political power is such that department store chains have found it easier to expand abroad than at home. Small local retailers are able to block or delay construction of large, efficient discount stores.

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