Japan agreed yesterday to lift import duties on cigarettes, pipe tobacco and cigars, and to provide other concessions to the U.S. tobacco industry that could increase sales there from $35 million to about $350 million.
Steve Lande, assistant U.S. trade representative for bilateral affairs, said the agreement, which ends a two-year dispute between the United States and Japan, is another step in the liberalization of Japan's trade restrictions that over the years have disturbed U.S. government officials and companies and contributed to America's trade deficit with Japan.
The relaxation of trade barriers by the Japanese, however, may not lead to any agreements on the automobile issue, Lande said. He declined to comment on the request to the federal government by Ford Motor Co. and the United Auto Workers union to restrict the numbers of Japanese autos and light trucks sold here. Congress is considering legislation that could lead to such restrictions.
U.S. tobacco companies have about 1 percent of the Japanese tobacco market, or between $35 million and $40 million in sales annually, Lande said. The companies said that under normal circumstances they would be able to gain about 10 percent of the market, which isn't "unreasonable" for the American companies to obtain under the ageement, Lande said.
"there has been a change in policy in Japan . . . over a couple of years," Lande said. "This is another example of it."
Under the agreement, the Japanese will:
Reduce tariffs on cigarettes from 90 percent to 35 percent, reduce cigar tariffs from 60 percent to 35 percent and reduce pipe tobacco tariffs from 110 percent to 60 percent.
Increase Japanese retailers' profit margins on sales of foreign tobacco from 7 percent to 8.5 percent in 1981 and to 10 percent in 1982 to encourage sales of more American goods.
Increase the number of retailers selling imported tobacco products from 14,000 to 20,000 in 1981; further expansion will be discussed at the end of that year.
Permit U.S. companies to advertise in Japan.
Lande said that during the negotiations U.S. representatives assured the Japanese that they weren't trying to ruin the health of Japanese by encouraging smoking, but only making certain American firms have freer access to Japan's markets.