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

DATE: THURSDAY, August 12, 1993                   TAG: 9308120087
SECTION: BUSINESS                    PAGE: B8   EDITION: METRO 
SOURCE: Associated Press
DATELINE: TOKYO                                LENGTH: Medium

JAPAN'S POLICIES CRITICIZED NEW TRADE MINISTER BREAKS RANKS IN TOKYO

Japan's new trade minister, breaking ranks with his predecessors and his ministry's long-held position, says his country's markets need to be opened to foreign companies.

"Japanese markets are extremely closed in invisible ways," trade minister Hiroshi Kumagai said in an interview published Wednesday in the Nihon Keizai Shimbun, Japan's leading economic newspaper.

Kumagai was sworn in Monday as a member of Prime Minister Morihiro Hosokawa's seven-party coalition government, which ousted the long-ruling Liberal Democrats.

The comments may provide the United States with fodder in trade talks with Japan that open next month. It remains unclear, however, just how much sway Kumagai will have in influencing the policies adopted by the powerful Ministry of International Trade and Industry.

Ministry officials downplayed the importance of Kumagai's remarks, saying new cabinet members often make comments that do not necessarily reflect the stance of the bureaucrats that permanently staff their ministries.

In any case, Kumagai as well as Hosokawa have voiced disapproval of U.S. requests to set numerical targets for increasing imports. Both ministers place high importance on reducing Japan's trade surplus but favor deregulation and expansion of domestic demand.

Kumagai's remarks were published the same day Japan announced a 28 percent jump in its global trade surplus in July from the same month last year, the 31st consecutive month of expansion from year-earlier levels.

The global surplus was $11.82 billion in July and the surplus with the United States was $4.68 billion, up 23 percent from a year earlier, the Finance Ministry said.

In the Nihon Keizai interview, Kumagai acknowledged that Japanese big business often conducts behind-the-scenes deals that exclude foreign and new companies from Japanese markets.

He compared such practices to the system used by construction companies to rig bids and ensure each company a certain share in major projects.

"We will have the surplus problem again and again unless we open the areas that are being criticized as closed," Kumagai said.

He did not suggest measures to prevent such arrangements.

by CNB