US-Japan Economic Relations US-Japan Economic Relations (Collected Papers on the Occasion of the Retirement of Professor Kaoru Ichikawa)

The June 1995 auto accord will contribute little to improve the US-Japan trade imbalance. Fundamental reasons for the US trade deficit lie elsewhere. Both need to make sustained efforts according to the SII agreement, the Maekawa report and the like. DrasCollected Papers on the Occasion of the Retirement of Professor Kaoru Ichikawa

The June 1995 auto accord will contribute little to improve the US-Japan trade imbalance. Fundamental reasons for the US trade deficit lie elsewhere. Both need to make sustained efforts according to the SII agreement, the Maekawa report and the like. Drastic macroeconomic policy efforts are called for on the US side. Japan needs further deregulation and other structural reforms to improve the US-Japan economic relations. Interestingly, only Washington and Midwest auto industries were adamantly against Japan in the auto dispute, other cities and states remaining indifferent or sympathetic with Japan. This kind of split will diminish in the future. The US and Japan, though different, do not find it easy to disentangle. Skirmishes do occur between Tokyo and Washington, but often lead the way to further talks and more open communication. Increasing cross-investment makes it harder and harder to disengage. Both countries stand on a solid basis of increasing intertwinement. Symbiosis must and will stay. Small quarrels on the surface should not, and will not, affect underlying good relations. Various actors of both countries are increasingly involved in the affairs of their counterparts on the other side. More kitchen talk goes on. Cautious optimism can therefore stay.