Kantor stresses talks with Japan on auto trade

Kantor stresses talks with Japan on auto trade

WASHINGTON (Kyodo): The United States will continue to seek an
accord on auto trade with Japan through negotiations rather than
press Tokyo with retaliatory threats, U.S. Trade Representative
Mickey Kantor said Friday.

''We have said before that we will not wait forever, which we
won't. But the preferred route is through negotiations and I
would be pleased if that was the result of the discussion,''
Kantor said in an interview with Kyodo News Service.

Highlighting his message throughout the interview of using
negotiations to resolve the impasse with Japan, Kantor brushed
off reports that the U.S. is ready to slap a list of items
subject to Section 301 trade sanctions as early as May.

''I think it is unfortunate if people are engaging in threats
at this point. We are not doing that,'' Kantor stressed.

''We are merely saying that we are committed to opening this
(Japanese auto) market and we hope to do it by negotiations if
possible,'' he said.

Kantor also voiced his strong wish to hold a bilateral meeting
with Japanese Minister of Trade and Indusrty Ryutaro Hashimoto
who has expressed reluctance to do so during a ''quad'' four-way
trade ministers' conference in Whistler, near Vancouver, Canada
in early May.

If Hashimoto will agree to such a meeting, ''I would be
pleased to meet with him,'' Kantor said.

On Thursday, Hashimoto told reporters that he will decide
whether to meet one-on-one with Kantor after expert-level talks
are held next week in Tokyo. ==More

Kantor said, ''If for whatever reason he (Hashimoto) thinks it
not in Japan's interest to carry on these discussion, of course
that is his decision and not mine.''

But he stressed, ''I am prepared to meet with him,
obviously,'' indicating his expectations for progress in the
Tokyo working-level meeting next week.

Kantor apparently took the softer approach to diffuse disputes
between vice ministers earlier this week that was feared by
currency dealers as a sign of a looming trade war. The dollar
briefly plunged below 80 yen in Tokyo trading Wednesday for the
first time in postwar history on speculation that the U.S. will
use the dollar-yen rate to threaten Japan.

Kantor refused direct comments on the impact of the trade
talks on currency exchange rates, but he voiced concern about
both economies.

''Failure to recognize this problem will have an adverse
effect on both the United States and Japan,'' he said.

With the subcabinet consultation failing to produce major
progress, U.S. negotiators said Washington is prepared to resort
to ''other options'' to resolve the talks. Japanese officials
countered by stressing their readiness to bring the case to the
new global watchdog World Trade Organization (WTO) to serve as a
''referee'' if the U.S. takes retaliatory actions.

The U.S. initiated a yearlong Section 301 probe under its
trade laws into Japan's replacement parts market last October,
with a deadline for possible sanctions set for Sept. 30. U.S.
officials have recently said the U.S. is preparing to move up the
deadline.

Kantor said, ''We haven't had a trade war in the world in 60
years and I don't expect we are going to have one now.''

On the controversial U.S. demand for renewed voluntary plans
by Japanese automakers to buy foreign parts, Kantor indicated
that he will continue to seek Japanese commitment on the issue,
but declined to comment on whether Washington is ready to propose
anything new to Japanese negotiators.

Calling Japan's insistence in rejecting such voluntary plans
as ''contradictory,'' Kantor said the Japanese government says on
the one hand ''with Europe they have export restraints. With the
United States they don't want to be involved in market
controls.''

''There will be no total agreement without all three being
addressed,'' Kantor said, pointing to the need for Japan to open
its finished auto, original equipment auto parts and secondary
markets.

The auto and auto parts areas are the only sectors unsolved
among the three priority areas under the bilateral framework
negotiations.

Asked whether the U.S. is thinking of a new formula for
renewing voluntary plans, Kantor said, ''I am not going to
negotiate the specifics in public. I think that would not be
fair to my Japanese colleagues nor would it be helpful to
negotiations.''