US-JAPAN TRADE DISPUTE. US envoys indicate impending trade vote could strain broader ties
The Reagan administration ``is not protectionist,'' insists its chief trade negotiator. Despite the imposition of retaliatory tariffs on Japanese electronic goods last week, ``the President has not changed his views on the importance of free and open trade,'' says United States Trade Representative Clayton Yeutter.
``The action on semiconductors is ... intended to be a temporary action,'' Ambassador Yeutter told the Shimoda conference, a high-level gathering on US-Japan relations, near Tokyo.
The conference discussion has focused on the trade conflict between Japan and the US, triggered by the American decision last week to impose tariffs on Japanese electronic goods. The $300 million in tariffs are in retaliation for alleged violation of an agreement on semiconductor trade reached last July.
Mr. Yeutter's words were relatively moderate, but the clear impression left by senior US government officials and congressional leaders on their Japanese counterparts here is that relations face a crisis in the weeks ahead.
What causes the greatest concern is the imminent passage of trade legislation by the US House of Representatives. According to several visiting US congressmen, a bill requiring the US President to retaliate against unfair trade practices will be voted on and overwhelmingly approved April 30. That is precisely the time Japanese Prime Minister Yasuhiro Nakasone is scheduled to be in Washington, on a visit which Japanese are seeing as key to preventing a trade war.
``Nothing that the administration has done and nothing that I can see the Japanese government likely to do, is going to change that fact [the expected approval],'' said Rep. Thomas Foley (D) of Washington, the House majority leader.
``The relationship between the two countries may take a short-term buffeting,'' Mr. Foley said. ``In the long term, they are so important ... that we simply can't tolerate a steady decline in the relations, economic or otherwise. ...''
Even for the well-informed Japanese officials present here, the congressional mood is a revelation. One participant expressed surprise at ``the intensity of the feeling in the US Congress over the trade issue'' aired at the conference.
The timing of the Nakasone visit, both sides say, is an unfortunate coincidence. ``He is coming at a bad time,'' said former Secretary of State Cyrus Vance, co-chairman of the conference. ``Somebody should have looked at the calender much more closely before they scheduled this.''
Congressional leaders, several of whom are present at this meeting, advised the Japanese leader, ``as recently as last night, not to come,'' says Rep. Rod Chandler (R) of Washington.
According to several sources, Japanese officials are still hopeful Mr. Nakasone's visit can have some impact on the situation, perhaps stopping passage of the so-called Gephardt amendment. That legislation, likely to pass with the trade bill, requires foreign nations' trade surpluses to be reduced by specific amounts yearly.
``I'm worried,'' Foley said, ``that perhaps in Japan there will be some expectation that [Nakasone's] visit might delay or change the character of the House of Representative's action. I think that's most unrealistic. ...''
Japanese participants say there is nothing that can be done now. The visit was set months ago, they explain, based on the only time when the Japanese parliament was not in session.
Both Japanese and American participants have stressed the need to shift attention to broader issues.
``US-Japan relations don't really hinge on semiconductors or even on this particular trade bill,'' says Sadako Ogata, a Japanese diplomat. Semiconductors, agreed Yeutter in his speech before the Shimoda participants, are ``a relatively small blip on the screen of economic relations between the two countries.''
While the message seems to be that the dispute should not cloud relations, both sides are aware that its symbolic, political importance cannot be easily avoided. Movement on the issue is key if the Nakasone visit is not to seriously harm relations, informed US sources say.
The White House, those sources say, will try to counter the hostile impression of the House vote on the trade bill. While it may be impossible for President Reagan to lift the trade sanctions during Nakasone's visit, he may clearly signal his intention to make the measures very ``temporary.'' Even this, both Japanese and Americans worry, may not be enough to calm the situation in the short term.