A top West German official has warned the Reagan administration that restrictions on Japanese auto exports to the United States -- even voluntary ones -- could trigger an international trade war.
Both Reagan administration and West German sources said yesterday that Dr. Otto Graf Lambsdorff, the West German federal minister of economics, told U.S. Trade Representative William E. Brock earlier this week that if the United States receives voluntary limits on Japanese cars imports, the Europeans would demand the same type of deal within two weeks to avoid the overflow of Japanese autos turned away by the United States. Lambsdorff warned that this in turn would lead to the worldwide imposition of protectionist measures for other industries.
Reagan's auto industry task force indicated Tuesday it is moving toward a recommendation that the president ask Japan to voluntarily limit auto exports here. Hours later, Japan's powerful head of the International Trade and Industry Ministry (MITI), Rokusuke Tanaka, said the ministry would use "administrative guidance" to try to persuade his country's automakers to curb exports to the United States. Administrative guidance is considered an order without the sanction of law.
MITI's announcement yesterday "is entirely consistent with what (Reagan's) task force wanted," a White House source said yesterday. "That's right on target."
"The Americans have spoken in favor of voluntary curbs on the part of Japan," Tanaka said. "As for us, I think we should apply self-control based on our own judgment."
However, an informed industry source said yesterday that MITI officials privately feel they still haven't gotten a clear signal on whether the Reagan administration is serious about limiting imports, so they are offering to voluntarily curb annual auto shipments to about 1.8 million cars to prevent more drastic administration or congressional limits. Last year Japan sold 1.9 million cars here and so far has moved well above that rate this year.
MITI could have restrained auto exports using Japan's export control act, but the Europeans would have demanded that Japan use the act to prevent a flood of Japanese cars to Europe, the source said.
Apparently, MITI has decided to use administrative guidance, by which "MITI will call in the companies and tell them without any written agreement how many cars to limit based on the numbers of cars they sold here last year," the source said. However, under this type of agreement, U.S. automobile importers may file lawsuits claiming that the Japanese have violated U.S. antitrust laws by restraining trade, the source said.
If the Japanese voluntarily cut back on car sales here, Reagan can demonstrate his willingness to help U.S. automakers without giving up his free-trade, antiprotectionist philosophy, the source said. In addition, a voluntary agreement by the Japanese would prevent the U.S. automakers from coming back to the administration every two or three years for an extension of protection under a bilateral agreement, the source said.
However, the administration is concerned, the source said, about European fears that a trade war could result from an arrangement between the United States and Japan. Brock and European Economic Commissioner Viscount Etienne Davignon will probably discuss the auto issue at a meeting today, sources said.
A German Embassy official said the imposition of limits on cars -- even voluntarily -- would result in other countries creating trade barriers to protect their other industries. For example, other industries would increase pressures on their governments for protection, and a protectionist domino effect would result, the German official said.
Other industries that would ask for protection would be Great Britain's suffering textiles, and European and American steelmakers. American industries that could be shut out from foreign markets would be soybeans, petrochemicals, poultry and textiles, an administration source said.