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have taken a firm stand in our negotiations with the Japanese over the terms of their accession to the Government procurement code. In connection with the section 201 complaint pending before the ITC, should there be a positive determination of injury to the domestic automobile industry, we will give a most careful review of alternative import relief options for the President's consideration.
We are mounting five major trade missions to Japan in the next 12 months. (I submit for the record our preliminary export promotion schedule for Japan 198082.)
Through our efforts, substantial imports of TV receivers from Japan have been largely replaced by U.S. manufactured or assembled TV sets in factories built by Japanese manufacturers in this country.
I do not need to remind you of the importance to the health of our economy of maintaining as fair and open an international trade system as possible. While our exports are now only 7.5 percent of our total GNP—a figure much less than our major competitors-only 10 years ago exports accounted for less than 4 percent of our GNP.
In other words, our exports are becoming an increasingly important part of our economy. And, in order to retain and increase export markets as you know, we must keep our doors open to imports. With your advice and support, we negotiated the MTN and its codes. With your guidance, we will aggressively monitor the implementation of the agreement by our trading partners to open up foreign markets to more American exports.
With your help, we will reduce some of the disincentives to our exports, such as sections 911 and 913 of the Tax Code, the Foreign Corrupt Practices Act, etc.
We look forward to working with you on these other measures which will help correct the deficit in United States-Japanese trade.
649 350 858 892 633 557 825
December 1980 by months:
807 731 609
1,526 1,651 1,810 1,843 1,599 1,788 8,280 10,217
2,582 2,432 2,359 2,413 2,730 2,461 12,756 14,977
673 4,476 4,760
1 Free alongside ship.
Imports seasonally adjusted.
Free alongside ship.
Wheat and flour.
432 1,159 318 307 981 348 227 247
336 1,032 450 229 321
510 577 1,087
564 916 1,744
U.S. EXPORTS TO JAPAN, 1978–79—Continued
(In millions of dollars ]
Pulp wood, wood pulp, et cetera
Paper, paperboard, et cetera....
Metal manufactures, nspf.
Power generating, including engines.
Electrical machinery and parts...
Autos, other motor vehicles and parts.
Aircraft, spacecraft and parts. Miscellaneous manufactures, nspf..
1 Free alongside ship.
U.S. imports of new passenger automobiles from Japan
(units) 381,338 703,672 697,788 624,805 791,791
695,573 1,128,936 1,341,530 1,563,047 1,617,328
782,777 1,016,318 Thousands
of dollars $455,971
928,784 1,138,216 1,244,128 1,686,255 1,741,554 2,855,297 3,859,566 5,770,790 6,471,054 3,305,790 4,055,134
[From the Business America, May 5, 1980.]
U.S.-JAPAN TRADE FACILITATION COMMITTEE Since its establishment in September 1977, the Joint United States-Japan Trade Facilitation Committee has developed into a key institution in U.S.-Japan trade relations. A review of its accomplishments over the past 30 months shows the wide range of areas the TFC has dealt with, and the contributions it has made to improved trade relations with Japan. The following review of accomplishments under the TFC during its two and a half years of operations was prepared by Norman D. Glick, TFC Staff Director, Office of International Economic Relations, International Trade Administration.
The Trade Facilitation Committee (TFC) was established by former Commerce Secretary Kreps and the Japanese Minister of International Trade and Industry as a cooperative effort between the two countries to increase Japanese imports of U.S. goods. The principal activities of the TFC include the identification and elimination of impediments to U.S. exports to Japan which result from Japanese trade practices and procedures; cooperation in export development activities; analysis and identification of export opportunities for U.S. firms in the Japanese market; and the development of related market information.
The first two years of the TFC have seen a number of export development activities. In March 1978, a 91-member Japanese Import Promotion Mission visited 17 cities in the United States. This mission was followed up in October 1978, with the 137-member U.S. Export Development Missions to Japan, led by Secretary of Commerce Kreps and Mark Shepherd, chairman of Texas Instruments, as Mission director. These missions were the largest single group ever sponsored by the Department of Commerce, and included high-level government officials and business executives from five industry groups-advanced scientific equipment, general industrial machinery, automotive parts, food processing and packaging equipment, and modern management equipment. The long-term success of these missions was quite favorable, especially in terms of the continuing business relationships they fostered. (The U.S. Development Missions were featured in a special issue of Business America, Nov. 20, 1978.)
The launching of “Boatique America" in Tokyo in October 1979 marks the most recent export development activity in Japan by the Commerce Department. “Boatique America” was a floating department store which carried high-quality Americanmade consumer goods for sale directly to Japanese consumers. It visited 13 Japanese ports, displaying the goods of 146 exhibitors. Sales reached about $3 million, and more than 400,000 people visited the ship. “Boatique America” was highly successful in its goal of exposing large numbers of Japanese consumers to American goods. A series of articles in this magazine, including the lead article in the Oct. 22, 1979 issue, tracked “Boatique America" as it toured Japanese ports. A number of studies concerning exporting to Japan have been
published by both the U.S. and Japan. The Japan External Trade Organization (JETRO-see preceding page) has published a series entitled “Access to Japan's Import Market" which covers such diverse areas as ceramics, coffee, carpeting, precious stones, and wine. A 1979 update to this series covers such subjects as pleasure boats, agricultural machinery, medical electronic equipment, and packaging machinery. JETRO also has issued publications entitled “Japan's Import System 1978 and Japan's Tariff System and Customs.
On the U.S. side, the TFC was closely involved in the Commerce Department's publication of the volume “U.S. Opportunities to Japan.” This survey of a number of industry sectors in Japan examines the characteristics of each sector and the marketing factors found in each.
The TFC has been extremely active in attempting to resolve cases concerning impediments to market access in Japan raised by U.Š. companies and trade associations. The TFC has received information conc
ncerning market access problems from more than 90 U.S. firms and industry groups. As of the end of March 1980, 60 of these were considered to be potential TFC cases and were forwarded to the U.S. Embassy in Tokyo. Following investigation, 21 of these cases have been transmitted by the Embassy to the Japanese side of the TFC for action, while in 19 more cases the Embassy is either in the process of obtaining additional information, or preliminary discussions are being held with the appropriate Japanese Government agency Of the 21 cases forwarded to the Japanese side of the TFC, 15 have been favorably resolved, 5 are still under consideration, and one was withdrawn as unresolved.
The cases dealt with by the TFC since its inception have covered a broad range of products whose access to the Japanese market has been impeded by Japanese practices or procedures. These include such products as medical equipment, telecommunications equipment, electrical applicances, tobacco products, shock absorbers, fertilizer, pleasure craft, and a number of others.
The TFC considers cases involving the products of a single company, or those of entire industry groups, where Japanese practices such as product standards approvals, administrative guidance, and government procurement practices adversely affect sales by U.S. firms. While continuing to solicit cases from individual U.S. companies, emphasis is being placed on the development of casès concerning problems faced by an entire U.S. industry. A number of such "generic" cases have been submitted to the Japanese side of the TFC or are being processed by the U.S. Government. Cases on behalf of fertilizer manufacturers and producers of modified food starches have been favorably resolved through the TFC.
The broad range of cases dealt with by the TFC is illustrated in the following brief outline:
ADMINISTRATIVE GUIDANCE The TFC has dealt with several cases involving the use of “administrative guidance,” that is, official pressure on Japanese buyers to procure parts and components from domestic sources rather than from abroad. One such case concerned the fertilizer diammonium phospate, whose import was being restricted by administrative guidance. The TFC was able to have this guidance withdrawn, and Japanese buyers are now free to import diammonium phosphate on the basis of their own commercial evaluation.
CUSTOMS CLEARANCE The TFC has received several cases involving difficulties experienced by American companies in clearing their goods through Japanese customs. Problems related to customs clearance have involved requirements for excessive documentation, clearance of commercial samples, reclassification of a product that resulted in a much higher duty rate than that for which the product was initially assessed, and difficulties in obtaining refund of duty for goods imported into Japan on consignment or for those unsold goods that are returned to their supplier.
STANDARDS AND TESTING PROCEDURES
One case resolved by the TFC concerned certification of hydrofoil vessels. The Japanese required the U.S. manufacturer to bring each completed vessel to Japan for inspection, a costly procedure since crew, engineers, and subcontractors' representatives had to accompany the vessels. As a result of TFC involvement, the Japanese Ministry of Transport agreed to consult with U.S. ship certification agencies and to inspect both vessels under
construction and the production of various critical components by subcontractors. The inspection trip paved the way for simplified and accelerated certification. These vessels have a substantial potential market in intercoastal transportation in the Japanese archipelago.
PRODUCT APPROVAL PROCEDURES
Another case resolved by the TFC involved the nonacceptance by Japan's Ministry of Health and Welfare of certain modified food starches as pernissible food additives. Their non-acceptance created obstacles to the exportation of various processed foods to Japan. After intervention by the TFC, these modified starches were reclassified to permit their import into Japan.
Much of the work of the TFC is carried out through liaison among concerned U.S. and Japanese Government agencies and Embassy officers stationed in Toyko and Washington. These activities are reinforced by the work of policy officials of both governments in sessions of the TFC's Senior Review Committee, co-chaired by Abraham Katz, Assistant Secretary of Commerce for International Economic Policy. The Committee meets several times a year to assess progress in the resolution of TFC cases and joint trade development activities.
The vital importance attached by the U.S. Government to the TFC has been emphasized in important bilateral policy consultations. The effective functioning of the TFC was a key point in a Joint Statement issued by Ambassador Robert Strauss and Japanese External Economic Affairs Minister Nobuhiko Ushiba in January 1978. The TFC also was featured in discussions with Prime Minister Ohira in May 1979 and in U.S.-Japan subcabinet discussions in October 1978. Congressional interest in the successful resolution of_TFC cases is highlighted by close monitoring of TFC activities by the Japan Task Force of the House Ways and Means Committee's Subcommittee on Trade.
The TFC has played an active role as a forum for resolving the problems encountered by U.S. firms attempting to do business in Japan. As it continues in its third year, it looks forward to continuing its successful efforts on behalf of U.S. business in Japan.
TENTATIVE EXPORT PROMOTION EVENT SCHEDULE FOR JAPAN-FISCAL YEAR
July 14-18, 1980—Electronic components exhibilition, USTC, Tokyo, Japan.