An effort by the United States and Japan to negotiate a settlement for heading off a bitter trade fight over autos ended in failure late Friday night.
U.S. Trade Representative Mickey Kantor announced the collapse of the negotiating effort after five days of discussions in Canada failed to bridge the wide gap between the two countries.
“The government of Japan has refused to address our most fundamental concerns in all areas,” Kantor said in a statement. “Discrimination against foreign manufacturers of autos and auto parts continues.”
Threatening to impose giant tariffs on Japanese products exported to the United States, the Clinton administration had billed the talks as a do-ordie attempt to resolve the thorniest trade issue between the two countries.
Kantor was scheduled to fly to Washington to report today to the president’s National Economic Council, which has been examining Japanese products to target with punitive tariffs that would take effect 30 days after a list of them is published.
President Clinton warned this week of “strong action” on America’s part if the talks failed to produce a breakthrough.
Industry sources, speaking on condition their names not be used, said one option being considered by the administration was to dramatically increase tariffs on Japanese luxury autos that now sell for more than $30,000. The tariff, or border tax, on all foreign passenger cars imported into the United States is now 2.5 percent.
“After 20 months of talks, it has become apparent that Japan will not take the steps necessary to bring genuine market access and concrete results in a sector in which Japan has a $37 billion trade surplus with the United States,” a weary Kantor said in his statement.
Kantor made the announcement at a crowded news conference after meeting with Japanese Trade Minister Ryutaro Hashimoto.