Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: TUESDAY, April 3, 1990                   TAG: 9004030684
SECTION: NATIONAL/INTERNATIONAL                    PAGE: A1   EDITION: EVENING 
SOURCE: Associated Press
DATELINE: WASHINGTON                                LENGTH: Medium

TRADE TALKS PROGRESSING

However, U.S. officials insist that true success will come only if the negotiations achieve a reduction in America's $49 billion trade deficit with Japan.

Talks were scheduled to resume today over one of the toughest issues facing the two economic superpowers: an effort to address the underlying problems that contribute to the trade deficit.

The Bush administration started the talks, known as the Structural Impediments Initiative, last July, seeking to force the Japanese to remove barriers that prevent the sale of American products and services in Japan.

The administration is demanding a halt to Japanese business practices that exclude foreign companies, as well as tougher enforcement of laws prohibiting bid-rigging and price-fixing.

The Japanese have focused on deficiencies in the U.S. education system, the huge federal budget deficit and low personal savings rates of Americans as primary culprits that harm U.S. ability to compete internationally.

Both sides are expected to release, perhaps as early as Wednesday, an interim report promising to make reforms. A final report is due in July.

The head of the U.S. delegation, Undersecretary of State Richard T. McCormack, termed the discussions "an historic opportunity" to make sweeping reforms to benefit citizens of both countries.

The administration has argued that opening Japan to more foreign competition would benefit not only Americans, but also would aid the Japanese, who pay some of the highest prices in the world for consumer goods.

Japanese Prime Minister Toshiki Kaifu called President Bush on Monday to say he was sending two emissaries to Washington as leaders of the 64-member Japanese delegation.

The two men, former Japanese Ambassador Nobuo Matsunaga and Deputy Foreign Minister Hisashi Owada, met with Secretary of State James A. Baker III while other members of the U.S. and Japanese delegations went over a new set of Japanese proposals.

Senior administration officials told reporters they were impressed with the Japanese proposals, which they said showed more willingness to make concessions than just a month ago.

"The proposals we are discussing are significant and represent a considerable amount of thought and effort on the part of the Japanese," said one administration official, who spoke on condition of anonymity.

Japanese Foreign Ministry spokesman Taizo Watanabe told reporters the Japanese initiatives were designed to ward off protectionist pressures in America and to benefit Japan.

"This is not being done for the sake of pleasing others, but to improve the quality of life for Japanese consumers," Watanabe said.

He refused to discuss details of the Japanese package. However, published reports said Japanese negotiators proposed, among other things, making it easier for large American retailers to open stores in Japan.