While it tries to weather the automobile export problem in the United States, Japan is being buffeted by tough European warning to curb its export offensives or face a new wave of protectionism in the countries of the European Community.
European leaders are taking much the same stance as Washington these days. Protectionism is a dirty word and something major trading countries should avoid, they say. But they simultaneously insist that unmoderated exports in key secots are politically unacceptable and will force Europe to erect its own protectionist walls.
In recent weeks, emissaries from France have said that weak and endangered French industries must be protected for a short period of time, at least. Britain's foreign secretary, Lord Carrington, has warned Japan not to make a separate deal on automobiles with the United States. Even West Germany, a solid free-trader, is calling on Japan to slow down.
Europeans complain that Japanese exports are targeted in certain strategic sectors whose vulnerability could undermine entire economies. They also accuse Japan of using a double standard by complying with American trade complaints while ignoring those of Europeans.
The outcry from Europe and the rise already of certain restrictions has convinced some Japanese leaders that the long-term outlook for exports is more serious in Europe than the United States, where they are being threatened with car quotes.
A common phrase here refers to the "three-legged-chair" of trade, comprised of Japan, the United States and Europe. "The third leg is broken," one high-ranking trade official said recently. Europe is more worrisome this year than the United States, he added, because the political effects of unemployment are more serious there. Politicians must talk tough about exports to get elected. "Japan is the scapegoat," he added, "and scapegoats are made to be beaten."
After a period of near-equal trade with Europe in the late 1970s, Japan racked up a sizable surplus last year. The surplus with 10 community countries was nearly $10 billion. In February, the Common Market announced that it would institute a new monitoring system to keep track of certain Japanese imports.
"That was really intended as a warning signal to Japan," one British economic expert said. "The [Europeans] felt that Japan has got to recognize its responsibility on exports."
A $10 billion deficit would not in itself be alarming, Europeans contend, but the one with Japan is concentrated in a few vital sectors -- automobiles and electronics, including television sets, in particular. Other export items that increased substantially in volume last year were bearings, machine tools, personal computers and ships.
These are not exports from low-wage marginal industries. They are among the industrial world's most sophisticated products, the type that all advanced countries are trying to nurture and promote.
In several European countries, either formal or informal barriers have been put up to stem the auto export fide from Japan. Italy permits only 2,300 Japanese cars a year to enter that country. France has unofficially established a quota that allows Japanese automakers to take only 3 percent of the market there, and hundreds of cars were kept waiting on French docks pending unusual inspections early this year.
In Britain, the rule of thumb is that Japan should not exceed more than 10 or 11 percent of the auto market. When the Japanese share edged above 11 percent last year, British automakers began grumbling. West Germany has no such limits and, partly as a result, Japanese imports there shot up about 46 percent last year.
A major European fear is that if Japan restricts its car exports to the United States this year its automakers will try to compensate by shipping even more cars to the European market. "If Japan does a deal with the United States, we are worried about a boomerang effect," said one British official. Lord Carrington told Japanese officials such a one-sided arrangement would be "unacceptable."
"We have a feeling in Europe that Japan pays close attention to the American requests on trade but not to Europeans'," the British official added. A recent visit here by Lord Carrington was partly an attempt to "get the Japanese to pay some attention" to the Europeans, he said.
One Japanese official privately agrees. "We are not so worried" about the European Community, he said. "It is of limited importance. There is less of a sense of responsibility to Europe."
Some Europeans are campaigning to make Japan's export surge a major issue at the Western economic summit meeting in Ottawa. Fancois Missoffe, a special adviser on trade to the French government, recently told reporters here that the issue of a trade imbalance almost certainly will be taken up at Ottawa. To soften the implicit warning, Missoffe said, "That does not mean that Japan will be in the position of the accused person. It will be there only as a partner.