Japan Calls New Talks With U.S. Critical

TOKYO —  Commerce Secretary Robert A. Mosbacher arrived Tuesday for three days of trade talks, and Japan acknowledged for the first time that the discussions have reached a “crisis” stage that could damage U.S.-Japan relations.

Mosbacher’s visit was being viewed as a final push by the Administration to get stalemated trade talks back on track before U.S. Trade Representative Carla A. Hills delivers a crucial report to Congress on Japanese trade at the end of the month.

The Bush Administration has warned that if the report contains no significant progress on U.S. demands to remove Japan’s barriers to increased trade and investment, Congress is expected to increase the call for economic sanctions against Tokyo.

Washington maintains that the only way to make a dent in the $49-billion annual trade deficit with Japan is for Japan to get its 122 million citizens to spend more, make it easier for American retailers to open stores in Japan and give its people a better life style.

“If we fail to resolve (trade) problems, then it will be a very serious matter. In that sense, we feel this is a crisis,” Japan’s top government spokesman, Chief Cabinet Secretary Misoji Sakamoto, told a news conference.

U.S. Ambassador to Japan Michael H. Armacost said in a speech in Tokyo this week: “If we can resolve trade problems in a spirit of friendship and equity, there are few limits to the possibilities of our wider partnership.

“If we fail, our relationship will become more troubled, and our peoples alone will not be the only ones to experience the adverse consequences.”

U.S. Embassy officials in Tokyo are billing Mosbacher’s visit as a “low-key” affair expected to produce no breakthroughs in the trade dispute.

Mosbacher will open discussions Wednesday with Japanese Foreign Minister Taro Nakayama and newly appointed Minister for Trade and Industry Kaubun Muto.

On Thursday, he meets Prime Minister Toshiki Kaifu and Finance Minister Ryutaro Hashimoto.

Mosbacher said in Washington before his departure that he wants to “make sure there is a clear understanding” between Bush and Kaifu following their summit meeting in Palm Springs earlier this month.

Kaifu told Bush he would make the trade dispute “one of the top priorities” for his Cabinet but offered no specifics.

In Washington on Tuesday, President Bush called Kaifu’s statements at the time “very constructive” and discounted Japanese media reports criticizing the prime minister. Kaifu has been attacked for promising too much.

“I think those reports just highlight the sensitivity of the situation in Japan, and I think as far as I’m concerned, the talks were very good,” Bush said.

In Tokyo, a heightened sense of urgency on the trade dispute was clearly evident among government ministries Tuesday.

Foreign Minister Nakayama told reporters, “We should realize that this issue amounts to crisis management in Japan-U.S. ties.”