Japan Hopes US Summit Will Patch Up Trade Rift

JAPAN'S worry that United States opinion swerved against it during the Gulf war has led to a summit this coming Thursday between Prime Minister Toshiki Kaifu and President Bush. Mr. Kaifu requested the summit, to be held in Newport Beach, Calif., after Mr. Bush met with French and British leaders while postponing a planned trip to Tokyo until later this year.

Kaifu hopes the summit will not only patch up torn ties with Japan's largest trading partner and sole military ally, but also bolster the Japanese leadership as it faces three immediate dilemmas.

The dilemmas involve whether to allow imports of rice into Japan, how to deal with a visit by Soviet President Mikhail Gorbachev, and how to shape Japan's role in the postwar Middle East.

All three concerns are viewed by US officials as a test of Japan's ability to help define and defend the rules of global trade and collective security, rather than just take advantage of such rules, as Japanese officials themselves admit they have done in the past.

Japan, however, regards the issues more as bilateral problems with the US than as challenges for it to help define global rules. The main purpose of the summit, says a Foreign Ministry official, is to "reconstruct" US-Japan relations following US criticism of Japan's initial hesitancy to contribute to the Gulf war.

Kaifu will seek Bush's advice and "understanding" on the issues of rice, Soviet ties, and the Middle East, but most of all "we hope the summit will turn the tide of anti-Japanese feeling in the US," adds the official.

On the rice issue, the US holds Japan partly accountable for the December 1990 breakdown of talks to further liberalize world trade by not offering to open up the protected Japanese rice market. The leadership in Tokyo is itself sharply divided on the issue.

The US argues that removal of all trade barriers in agriculture is the key to the talks known as the Uruguay Round, which is aimed at liberalizing many trade areas not covered under the auspices of the General Agreement on Tariffs and Trade (GATT).

Trade talks key

"We've been disappointed with Japan's performance in the GATT talks," says US Ambassador to Japan Michael Armacost. "The rice issue has paralyzed the government and inhibited activity on other issues where our interests largely converge."

For Japan as well as the US, "the need is to summon the political will to discipline domestic political forces to the requirements of international cooperation," the ambassador says.

A symbolic challenge was made last month to Japan's closed-door policy on rice imports, a policy reinforced by strong ties between the ruling political party and farmers' cooperatives.

The US Rice Millers Association (RMA), with US Embassy approval, displayed several bags of rice at an international food fair in Tokyo. After Japanese authorities threatened to prosecute the RMA officials, the rice display was removed.

The incident further harmed Japan's image in the US, even drawing a comment from Bush and some sarcastic humor from the US ambassador.

"You may notice the police outside the Embassy giving visitors breathalyzer tests to detect harmful amounts of foreign rice," joked Mr. Armacost to an American business group in Tokyo. "But I'm here to tell you that you can bypass this by coming to the back of the Embassy and telling the Marine guard that Uncle Ben sent you."

Kaifu will also discuss an upcoming three-day visit by Mr. Gorbachev to Japan starting April 16. The Soviet leader is expected to propose an Asian security arrangement that could be aimed at scrapping the 1960 US-Japan security treaty. The idea could have wide appeal among Japanese and lead to strains with Washington.

In addition, Gorbachev may offer to return two or all of the four small islands off northern Japan occupied by the Soviets since the end of World War II. Since Japan has linked return of the islands to Japanese aid and investment, Kaifu would be under pressure to differ with the US, which seeks to restrain large-scale aid to Moscow until basic domestic reforms are underway in the Soviet economy.

Greater ties with Soviets

The US has tried to maintain a unified stance among its Western partners on aid to Moscow. The issue was a prime topic at last July's seven-nation summit of Western industrial nations. At that time, Japan took a separate course from its fellow summitteers by announcing it would normalize ties with China.

Kaifu will also discuss with Bush how Japan can avoid being the odd man out in reshaping the Middle East, since it did not share the risk by sending personnel to the war area.

"We want to be an active player," says the Foreign Ministry official, especially on economic reconstruction of affected nations, curbing arms exports to the region, and cleaning up the Gulf oil slick.

Rather than continue the practice of mainly securing oil supplies for itself by seeking close ties with a few Middle East nations, Japan is being encouraged by the US to provide financing and aid to bring peace for the whole region, as well as warm up its cool relations with Israel.