May 3, 1999
Web posted at: 5:08 p.m. EDT (2108 GMT)

WASHINGTON (AllPolitics, May 3) -- During a joint news conference with Japanese Prime Minister Keizo Obuchi, President Bill Clinton said Japan must reduce the amount of steel it exports to the U.S. or he will act to keep Japanese steel out of U.S. markets.

"We will take action if steel imports do not return to their pre-crisis levels on a consistent basis," Clinton said. "Playing by the rules of trade is the best way to sustain a consensus for open trade.

President Clinton spoke at a joint news conference with Japanese Prime Minister Keizo Obuchi

The action could come in the form of up to a 67 percent tariff on all hot-rolled carbon steel imported into the U.S. With the possibility of a retroactive application of the tariff, Japanese steel would effectively price out of the U.S.

The Commerce Department has accused Japanese steel companies of dumping steel on U.S. markets at less than home-market prices.

Although Obuchi did not respond to the president's comments, he said Japan was "swiftly and boldly taking every measure in order to address the difficulties we are facing and to achieve Japan's economic recovery."

Earlier Monday Clinton welcomed Obuchi to the White House Monday for trade talks and discussions about Japan's economic recovery, saying "our nations are proud to reaffirm our partnership for the new century."

"The economic difficulties of recent years have been a challenge to many people in Japan and throughout Asia, but with the right choices Japan and Asia will emerge stronger more open, more democratic, better adapted to meet the 21st century," Clinton said at the morning White House arrival ceremony.

While Obuchi said the Japanese economy is "showing an emerging sign of change for the better" and that his nine-month-old government is "determined to ensure a successful revitalization for the Japanese economy," Clinton used the day of talks to encourage Obuchi to do more to open the Japanese market and speed the recovery.

The United States often complained during the past seven years of Japan's recession that Tokyo's powerful bureaucracy was choking the its nation's economy as well as thwarting foreign access to its markets.

As the two leaders met, Deputy U.S. Trade Representative Richard Fisher announced an agreement on a new deregulation initiative. The deal included a Japanese pledge to encourage expand sales opportunities for U.S. telecommunications companies, drug manufacturers, lumber companies, banks and brokerage firms and energy companies.

Obuchi arrived at the White House Monday for trade talks and discussions about Japan's economic recovery

Clinton said the agreement will help encourage U.S. investment in Japan, something experts say will help grow the stagnant economy in Japan.

"The emphasis in this is to help Japan turn its economy around and pull up its socks," Fisher told reporters. "To do that, significant deregulation is mandatory."

But Obuchi's visit comes as figures released last week reflected a jump in Japanese unemployment rates to a new record high, putting added pressure on the government to pull the economy out of the worst recession Japan has experienced in 50 years.

The government said unemployment had climbed 0.2 percent in March from the previous month's record to 4.8 percent.

Obuchi admits the unemployment rate, which is twice what Japan is accustomed to, may continue to increase as Japanese companies are expected to cut more jobs. Other international forecasters predict there will be negative growth in the Japanese economy well into next year, a far cry from Obuchi targeted 0.5 percent rate of growth.

Politically Obuchi's hand has been strengthened by recent legislative victories at home. The lower house of Japan's parliament last week approved legislation strengthening U.S.-Japanese military cooperation, a move Clinton also praised during Monday's news conference.

And last month lawmakers approved Obuchi's record economic stimulus plan designed to lift Japan from its eight-year slump. The United States had pressed for both, analysts said.

Another topic of discussion is sure to be the U.S. trade deficit. Last year the deficit rose to $169 billion last year, including a $64 billion deficit with Japan. The deficit has become a sore point for the White House.

Obuchi began his six-day visit in Los Angeles Thursday. It is the first official visit of a Japanese prime minister in 12 years.

The Associated Press contributed to this report.

Monday, May 3, 1999

• Senate likely to table Kosovo resolution
• Clinton, Japanese prime minister discuss economy and trade
• Quick start to Julie Hiatt Steele's obstruction trial
• Poll: Congress should have authority over U.S. involvement in Kosovo
• Poll: Violence in the media should be regulated
• Poll: Gore widens lead; Dole gains on Bush
• Thompson: Presidential hopes 'on life support'
• David Duke not ready to go quietly
• Eight GOP hopefuls perform for N.H. party leaders
• Jackson revels in winning release of captive GIs
• Texas cities choose mayors in light turnout
• Clinton jokes with the press at black-tie dinner

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