Clinton Visit to Japan Aims At Security, Not Trade, Ties

IN recent years, American and Japanese trade officials have opened their meetings by giving each other sporting goods that double as weapons: a baseball bat and a bamboo sword. The idea was to preface their often bitter discussions over trade with staged bonhomie.

Next week, when President Clinton sits down in Tokyo with Japanese Prime Minister Ryutaro Hashimoto, the sense of camaraderie will be more genuine. Both leaders have a political stake in pulling off a summit free from acrimony, and celebrating recent improvements in their trade ties

Although the US has spent decades charging that Japan does not play fair in the game of international trade, Mr. Clinton will avoid such stridency during his April 16-18 visit. That is mainly because the two must first concentrate on fixing some problems in their security relationship.

A 1960 defense treaty obliges the US to defend Japan, and the US keeps some 45,000 US troops in this country, most of them on the southern island of Okinawa. The rape of an Okinawan girl by three US servicemen last year has spurred a movement to evict the Americans. That in turn has concentrated the efforts of Japan and the US to make sure that their alliance prospers.

Consequently, the focus of next week's meetings will be security, not trade. "We're going back to the warm, fuzzy summits of the old days of US-Japan relations," says John Neuffer, an analyst at the privately funded Mitsui Marine Research Institute in Tokyo.

Turning back the clock?

During the cold war, Washington overlooked its trade frustrations in order to win Japanese support in containing the Soviet Union, leading to summits that were long on security-oriented statesmanship and short on addressing their economic imbalances.

Another reason that the US will not be too tough on trade is that imbalances are not as great as they once were. The US trade deficit with Japan was $59.3 billion last year, down $6.4 billion from '94. Similarly, the Japanese are buying more US merchandise - $64.3 billion worth. That figure is up $10.8 billion, or 20 percent, from '94.

Since late last year, US officials have been pointing to these numbers and crediting the roughly 20 trade agreements negotiated between the US and Japan during the Clinton administration. Economists note the role of currency fluctuations - a strong yen during most of last year made Japan's goods more expensive abroad and imports cheaper - but add that Clinton's trade policy has indeed contributed to the opening of Japanese markets.

So Clinton's visit will in part a victory tour, since his predecessors proved unable to register such an impressive turnaround in the US-Japan trade relationship. The coming US presidential election is another reason Clinton will want to highlight what has been accomplished rather than what needs to be done.

Mr. Hashimoto, whose popularity has been declining, also faces an election sometime during the next 14 months and analysts say he wants to use the event to appear statesmanlike.

US says it's pressing ahead

All of this is not to say there are no trade issues for the two sides to discuss. Indeed, US officials insist they are pressing ahead to win progress in four areas: access to Japan's insurance business, the renewal of a bilateral agreement on semiconductors, a plan to liberalize the transpacific passenger-flight market, and an effort by the Eastman Kodak Company to correct some alleged inequities in the Japanese market for photographic film.

"The pundits are wrong," says a US official who requested anonymity. "No one [in the US government] is saying we shouldn't expect progress on economic matters because the security issues are so important."

"We expect Clinton to raise [economic issues]," concurs a Japanese official who also requested anonymity, "but not to discuss details."

American and Japanese negotiators will meet this weekend to try to resolve their insurance dispute and comments by Japan's ambassador to the US suggest the two sides may find a way to renew the semiconductor agreement. Hashimoto also reportedly plans to offer Clinton a package of deregulatory measures that would make it easier for US companies to compete in Japan's market for construction industry.

Jeffrey Garten, a former US undersecretary of commerce for international trade, told reporters here yesterday that the summit would focus on recent improvements in the trade relationship. "Below the surface," he added "I don't believe the relationship is as comfortable as it will appear."

He argues that trade relations will soon stiffen, in part because the yen has weakened. Many Japanese companies have also taken advantage of hard times to restructure. He also worries that the US and Japan will be increasingly at odds over the booming economies of Asia, where both countries are trying to develop new markets.

And in the future, he says, trade disputes will have to be handled in international settings like the World Trade Organization. The US, Mr. Garten says, "has never been comfortable dealing on a multilateral basis among equals."