Japan may budge on rice-import ban Officials contradict each other on issue

TOKYO -- Japan's newly installed Cabinet replied in two voices yesterday and today to urgent U.S. appeals for Tokyo to help unblock world trade negotiations by easing its ban on imported rice.

"Now is the moment for Japan to do everything it can to help bring these talks to a successful conclusion," U.S. Trade Representative Carla A. Hills declared in a talk to the American Chamber of Commerce here.


Foreign Minister Michio Watanabe and Mrs. Hills agreed that the two countries should join forces to bring the talks to a successful conclusion by the end of the year, Japanese news reports said.

A Foreign Ministry spokesman said Japan is prepared to make an unspecified "concession" on agriculture if the United States and the European Community will budge first.


But Tsutomu Hata, the new finance minister, stuck to the familiar Japanese position -- that rice is "the last staple food for 120 million Japanese people." Conversion of the long- standing import ban to tariffs, which would then be gradually reduced under a U.S. proposal, is not in the cards, he asserted.

At stake is a long-sought and immensely complex agreement in the Uruguay round of negotiations under the General Agreement on Tariffs and Trade, the basic document of international business among capitalist countries. The talks are aimed at a vast expansion of world commerce through reduction of trade barriers. Third World countries entered the talks to get market access for "thene thing they have to export -- agricultural products," Mrs. Hills said.

They will not further open their markets to manufactured goods if the industrial countries insist on a right to block agricultural imports, she said.

Blocked by industrial countries' politically sensitive agricultural policies, the talks failed to produce an agreement by their original deadline last winter, but negotiations have continued.

Mrs. Hills said that she hopes for an agreement by early next year.

Rice and the GATT talks have dominated news coverage of Mrs. Hills's talks here and in Korea, but she also has taken up a broad range of Japan-U.S. trade differences:

* The Structural Impediments Initiative. Japanese officials have been nervous all week about calls by President Bush and Secretary of State James A. Baker Jr., for "reinvigoration" of the wide-ranging SII talks. U.S. officials have yet to lay out just what these remarks mean. Mrs. Hills said that the main goal is to see that the process does not lose momentum after a good start on issues like Japan's "keiretsu" system of closed business relationships and the country's arcane retail distribution system.

* Trade deficit. More than 75 percent of the $40 billion U.S. trade deficit with Japan is in automobiles and auto parts, and Mrs. Hills said opening this country's auto market is a key topic. But she also took up other sore points, including Japan's minuscule imports of glass and paper, restrictions on foreign lawyers working here and the virtually total exclusion of foreign suppliers from government computer purchases.


"They've been in office about a week," Mrs. Hills said when asked about the reaction she was getting from Japanese Cabinet members. "I think they need some time."