The Reagan administration, in an apparent effort to put new pressure on Japan, refused to send its top negotiator to trade talks in Tokyo yesterday because the Japanese refuse to "get down to the nitty-gritty" of bargaining over U.S. access to its telecommunications market. The talks were postponed.
Commerce Secretary Malcolm Baldrige disclosed yesterday that he had decided against sending Undersecretary of Commerce Lionel Olmer to the negotiating table and admitted the decision puts "a time pressure" on the talks. Trade negotiators are working against an April 1 deadline.
"I think it will be to the benefit of both sides when we do sit down and talk to stop talking about the theory and the background and get down to the nitty-gritty, because the nitty-gritty is what's going to make or break the success of these negotiations," Baldrige said.
Baldrige said he decided against sending Olmer to the talks after Vice Minister of Post and Telegraph Moriya Koyama told him last week that the Japanese wanted the talks to go over basics instead of getting down to specific issues. U.S. and Japanese trade negotiators met in Tokyo last month to discuss the basic framework of the talks. The negotiations scheduled to open yesterday were supposed to deal with specific issues.
"I really thought we had gone over the fundamentals sufficiently in the first round of talks," Baldrige said.
The telecommunications talks are part of a broader U.S. effort to open Japan's markets to competitive U.S. products in four sectors: telecommunications, wood products, pharmaceutical and medical equipment and sophisticated electronics. The talks resulted from last month's meeting between President Reagan and Prime Minister Yasuhiro Nakasone.
The two nations also face an April 1 deadline on whether to review Japan's so-called "voluntary" restraints on auto exports to the United States. Last week, Reagan was advised by a special Cabinet council to consider the highly political auto issue in the context of the broader trade relations.
Trade frictions between the two countries have intensified as a result of Japan's $36.8 billion trade surplus with the United States, which Baldrige said could be reduced by at least $12 billion if competitive American products had equal access in Japanese markets.
Despite yesterday's cancellation of the telecommunications talks, negotiations over wood products proceeded in Tokyo as scheduled.
As an indication of the tensions, however, the wood talks erupted into a shouting match yesterday when U.S. negotiators asked for the complete elimination of all tariffs, the Associated Press reported. Agriculture Undersecretary Daniel G. Amstutz said he was "disappointed" by the Japanese opposition to his proposal, while Japan's negotiators said they had not expected the strong U.S. demands.
Negotiations in the other two trade areas discussed at the Reagan-Nakasone meeting are still in the preliminary stages.
In another slap at the Japanese, a key senator in trade affairs, John C. Danforth (R-Mo.), said he will no longer meet with delegations from Japan because it "is a waste of time." He said he declined to see two personal emissaries from Nakasone, Sony Chairman Akio Morita and former foreign minister Saburo Okita, as well as a delegation from the Japanese Diet (Parliament).
"The delegations are once again pouring into Washington from Tokyo. Until one of those delegations can produce evidence of actual sales to show that the Japanese market is indeed open, I have no intention of seeing any of them," said Danforth, chairman of the Senate Finance Committee's trade panel.
The telecommunications talks were given the highest priority in the Nakasone-Reagan talks because of the deadline for new regulations governing access to the Japanese market. The regulations implement a recently passed law turning the government telecommunications monopoly over to private hands and opening the industry to competition for the first time.
Baldrige said talks indicated that the Japanese are not willing to give American companies the same right to certify that their products meet Japan's standards that Japanese companies have on their exports to the United States. Instead, he continued, Japan wants to hand the certification procedures to a committee of bureaucrats and representatives of Japanese companies who are likely to be prejudiced against American companies.
The regulations, moreover, will require individual certification "seals" for each shipment.
"That's what they are aiming for," Baldrige said. "We have said we can't agree [that] that's opening their market."
The market-opening initiative in telecommunications is especially sensitive because Japan took advantage of the breakup of American Telephone & Telegraph Co. to increase its exports from $600 million to $2 billion, while American sales in Japan remain at about $300 million.
Baldrige said he was "surprised" that Japan was not willing to move to specific issues.
"I still haven't given up," he added. "I think the prime minister's commitment and his desire to see it carried out are very real. We shall know in a month."
In the lumber talks, Japanese officials indicated willingness to remove some nontariff barriers to forest products, but said the talks were never intended to remove all barriers. "We had agreed to discuss the trade in broad terms but not to wipe away all obstacles," a Foreign Ministry official said.
John Burgess of The Washington Post Foreign Service contributed to this report from Tokyo.