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Strategies & Market Trends : JAPAN-Nikkei-Time to go back up? -- Ignore unavailable to you. Want to Upgrade?

To: fut_trade who wrote (1264)	7/14/1998 6:24:00 AM
From: fut_trade	Read Replies (1) \| Respond to of 3902

Japan,U.S. business sound alarm on Japan economy By Miki Shimogori TOKYO, July 14 (Reuters) - Unlike past meetings often overshadowed by bitter trade disputes, Japan and U.S. business leaders presented a united front on Tuesday to press Japan to take ''urgent and drastic'' action to revive its economy. More than 90 Japanese and U.S. business leaders who had gathered in Tokyo for a three-day annual conference sounded an alarm for the Japanese government, saying that a sense of urgency was what the nation must keep in mind. ''One of our purposes...is to reinforce the sense of urgency to tackle many fundamental issues that are facing Japan today because of their broader implications through Asia and around the world,'' Michael Jordan, chairman and chief executive of CBS Corp , told a news conference. Jordan co-chaired the 35th Japan-U.S. Business Conference with Mitsubishi Corp Chairman Minoru Makihara. ''Both sides shared a common view, as a sense of crisis is spreading amid Japan's economic gloom and a planned change in the administration (of Prime Minister Ryutaro Hashimoto),'' Makihara told the same news conference. On Monday, Hashimoto announced that he would step down as prime minister to take the blame for his Liberal Democratic Party's stunning setback in Sunday's Upper House election. A joint statement released after the conference called for steps by Japan to remove bad loans from bank balance sheets, for swift implementation of permanent cuts in corporate and income taxes, and for consolidated taxation. ''Given its extensive trade and investment ties throughout Asia, Japan in particular should renew efforts to open its markets to foreign goods and services and stimulate its economy, in order to stabilise the yen and spur economic recovery in the region,'' the statement said. The business leaders also said that development of ''electronic commerce'' should be led by the private sector, and urged government not to impose unnecessary controls. Yotaro Kobayashi, chairman of Fuji Xerox Co Ltd, said there had been a fundamental change in the position of Japanese business leaders, who in contrast to their U.S. counterparts participating in a robust U.S. economy, have increasingly lost confidence. ''We now admit that Japan's (economic) problem is the top priority issue, and the joint statement symbolised the changing relations between the two sides,'' Kobayashi said. Fuji Bank chairman Toru Hashimoto echoed that view, saying that although the U.S. economy was now performing well, that would not last forever and would eventually come to a turning point. ''It is important to ensure recovery in the Japanese economy by that time,'' he said. Bilateral trade issues were treated as a secondary topic at this meeting, but U.S. business leaders said that trade could re-emerge as a political problem in the future. ''Clearly a rising trade deficit can be a political problem in the United States, but I think leadership in our country can defend the current situation as we see vigorous action taken by Japan in line with our recommendation,'' CBS's Jordan said. Henry Schacht, senior adviser for Lucent Technologies Inc , said, ''I believe the United States would tolerate a reasonable amount of trade deficit so long as at the same time it is clear that Japan is as the statement suggests, taking vigorous and urgent action to restart a domestic demand-led recovery.'' But he warned of a possible isolationist reaction in the United States if the trade deficit ballooned and Japan failed to take action quickly enough to begin a sharp and rapid recovery.