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

DATE: THURSDAY, January 20, 1994                   TAG: 9401200040
SECTION: BUSINESS                    PAGE: B-8   EDITION: METRO 
SOURCE: Associated Press
DATELINE: WASHINGTON                                LENGTH: Medium

JAPANESE TRADE PLAN ENDS DISPUTE

A BREAKTHROUGH offer will open bidding on Japan's major public works projects to U.S. contractors. The Clinton administration Wednesday approved a Japanese plan to open its construction market to U.S. companies and said it would withdraw the threat of trade sanctions.

U.S. Trade Representative Mickey Kantor made the announcement after officials had spent a day reviewing the Japanese proposal, which would open up bidding on major public works projects to all qualified bidders, including foreign companies.

"The government of Japan has addressed all the major U.S. concerns," Kantor said at a news conference at which he praised Japanese Prime Minister Morihiro Hosokawa for his "commitment to reform Japanese procurement and regulatory practices."

Kantor's announcement came one day before a deadline set by the administration for Japan to resolve the bitter trade dispute or face the possibility of punitive sanctions against its exports to the United States.

The new procedures, which are scheduled to take effect April 1, call for open, competitive bidding on the government's biggest public works projects. The plan will cover central government construction projects worth at least $7.69 million and projects sponsored by public corporations that are worth at least $25.69 million.

The plan would open about 20 percent of Japan's public works to competitive bidding. Local government projects will be exempt from the new rules as well as projects that fall beneath the monetary thresholds.

Still, Kantor had high praise for the program and said he hoped it signaled a new willingness on the part of Japan to resolve other divisive trade disputes under negotiation.

Those "framework" talks represent an effort by the United States to pry open Japan's market in several areas.

Kantor conceded that with a deadline for initial results just three weeks away, there has been little progress. But he said he hoped the breakthrough in the construction area "sets the stage for concluding meaningful framework agreements" prior to the Feb. 11 summit meeting between President Clinton and Hosokawa.

Japan's construction sector, which long has been an area of bitter dispute between Tokyo and Washington, recently has been rocked by scandal, with many large Japanese firms suspected of making huge payoffs to government officials to ensure favorable consideration.

The plan approved by Hosokawa's government specifically says that all construction companies, Japanese or foreign, will be considered equally.

Kantor conceded that the agreement did not set any targets for the number of contracts the United States hopes to win, but he said it does call for annual reviews as a way of making sure Japan honors its commitments.

by CNB