Moderator: We will now start the Press Conference given by Prime Minister Hashimoto. The Prime Minister will first make some initial remarks. Thank you very much, ladies and gentlemen, for coming.

Initial Remarks by Prime Minister Ryutaro Hashimoto

II. Topics of discussion in the Summit Meeting with President William Clinton of the United States

Prime Minister Ryutaro Hashimoto: Thank you very much for coming, ladies and gentlemen. Between 19:00 and 20:00, I had my first Summit Meeting with President William Clinton of the United States of America in Santa Monica, and I have just arrived here. I intended to come to the meeting for a frank exchange of views, and President Clinton was also very frank in his attitude; we had a very lively one hour in a very cordial atmosphere. The one hour passed away very quickly. There were three points which I wanted to convey to President Clinton. First is that Japan-United States relations are extremely important and that this relationship should be made even deeper and stronger, that efforts must be made on both sides. This I say, because at the time of the Automotive Consultations last year, the European Union and many friends in Asia expressed their fear that a chasm might open up in Japan-United States relations due to the auto issue, and they asked us not to let this happen. This means that other countries also see the importance of the Japan-U.S. relationship, and the bilateral relationship is built on the Japan-United States Security Arrangements. We will maintain this steadfastly, not only for Japan and the United States, but also because the U.S. presence in the Asia-Pacific will contribute greatly to the stability and peace of the Asia- Pacific as well. This is a point that we will do our utmost to make sure that the Japanese people understand, and therefore, we also expect the utmost cooperation of the United States with regard to realignment, consolidation and reduction of U.S. military facilities in Okinawa. The second point I wanted to make is that I am fully aware of the fact that there are numerous economic issues between Japan and the United States. We should not unduly play up these issues; it would not be for the benefit of either Japan or the United States, and therefore, it is essential that we try to resolve these issues one by one. The third point I made was that Japan will change, and Japan will inevitably change significantly. Setting aside all these elements, demographic changes alone will force Japan to change. We are now working, as a top priority matter, on economic recovery in Japan, and to this end, also promoting deregulation. Some regulations will have to be completely removed, and some regulations will have to be relaxed. These efforts are necessary and I intend to act on this. Soon, an augmented deregulation action program will be announced, for example, with regard to housing. We will change the conventional rules, change them into performance standards. That should make it easier for U.S.-made homes or houses to find their way into the Japanese market. Currently in the Diet, debate on the jusen issue -- the housing and loan company issue -- is being taken up as a major issue, and the proposal we made for mobilizing public funds has been the target of severe, harsh criticism by the Japanese people. But, we shall try to overcome these issues and introduce early corrective measures modeled after the U.S. system and build a new financial system. We are already making moves in that direction. These were the three points I wanted to convey to you and said to President Clinton. President Clinton, in response, made very succinct comments, very much to the point on these issues, especially in regard to Okinawa. He sent me very good signals as we work on the resolution of these issues in the coming days. With regard to the jusen issue, President Clinton said he was aware of the discussions and debates going on in Japan and that he has full sympathy for me. He said that the United States also had a very tough time trying to resolve the S&ampL issues. The resolution proposed was not very popular among the people of the United States. Also, at the time of the Mexican financial crisis, President Clinton took a certain action and some eighty percent of public opinion was opposed to that proposal, but it is important that, in spite of such opposition, you act on those proposals. I expressed a high appreciation for the peace efforts being made by the United States in the former Yugoslavia and his determination to bring peace. I said that it is through such determination that peace has been brought to a certain region of the world. In addition, I commented on the Korean Peninsula Energy Development Organization (KEDO) issue related to North Korea and also expressed the importance of the Common Agenda. I said that we should both try to produce meaningful results for the April visit by President Clinton to Japan. Thank you.

Moderator: Thank you very much, Mr. Prime Minister. We would now like to open up the floor to questions and answers. If you would like to raise any questions, please raise your hand and wait until you are chosen, and please identify yourself by stating your name and affiliation first. You can state your questions in either Japanese or English, but briefly please.

Questions and Answers

III. Realignment, consolidation and reduction of U.S. military facilities in Okinawa (1)

Q: Prime Minister, thank you very much for this opportunity, I know you should be tired. Earlier you mentioned that the security issue was discussed with President Clinton. More specifically, I would like to ask you, at the time President Clinton will visit Japan in April -- what do you think will be the specific progress you will be able to see vis-a-vis the consolidation, realignment and reduction of Okinawa facilities and areas? This is the first question I would like to address to you, Mr. Prime Minister.

A: Thank you very much for that question. I would have to say very honestly and frankly that we did not have a very detailed discussion on this matter today, but I used, as an example, Futenma base in my talks with him. But we were not given enough time to go into the specific details of these matters. Having said this, I would also like to say that I was able to sense the strong position taken by the United States of feeling the need for the maintenance of the Japan-United States Security Arrangements and the significance of maintaining bases in Okinawa, Japan. That was at least the sentiment, the feeling, conveyed to me by President Clinton. This being the case, I believe further efforts will be made and will have to be made in the 2+2 Talks, in addition to the joint Special Action Committee, between the two countries, so that the vigorous work, I hope, will be able to see as much progress as possible until the time of President Clinton's visit. Having said so, I would also like to mention, at the risk of repeating myself, we did not have time to go into the details, so we were not able to get into any specific discussions on this.

IV. Economic issues between Japan and the United States

Q: Prime Minister Hashimoto, did President Clinton raise the issue of the renewal of the United States-Japan Semiconductor Agreement and if so what was your response?

A: Not in the form of the Japan-United States Semiconductor Agreement. As common economic issues between us, there are the issues of semiconductors, photographic film, insurance and civil aviation. These were listed, but we simply said that a favorable solution will come out of consultations. It was only discussed in that form, and President Clinton did not go into each of these items. As I mentioned at the outset, we are fully aware of the existence of economic issues but we should not play up those issues and undermine the Japan-United States relationship. That was the only reference I made to that, too -- nothing beyond that.

V. Situation between the People's Republic of China and Taiwan (1)

Q: I wonder if there was any discussion on the tension between China and Taiwan. If so, who raised it and what sort of specific discussion did you have?

A: As an extension of the Korean Peninsula issue, we did raise this matter of tensions in the Taiwan Strait. But we did not have sufficient time to discuss in detail individual issues. With regard to this tension across the Taiwan Strait, we said that we hope that both sides will act with a cool head and exercise self restraint; that is what I hope.

VI. Intellectual property rights

Q: Bill Clinton is a musician, and, just as an example with regard to the intellectual property issue -- I wonder if you discussed the intellectual property issue? Also if, for example, The Beatles are one of the world's most popular groups and yet they recorded most of their music before 1971, and under the General Agreement on Tariffs and Trade (GATT), music fans all over the world will pay royalties when they buy music from The Beatles. So I am wondering why it's not fair that the Japanese music fans also pay royalties when they buy Beatles music. Thank you.

A: Are you talking just about the Beatles? Presley is another very popular musician, isn't he? In my talks with President Clinton, a reference was not made to this neighboring rights issue of intellectual property rights. In this connection, I think I can say that Japanese neighboring rights had been established before other countries established their rules, setting it at twenty-five years. Quite recently, many developed countries have decided to provide protection for fifty years. Under the World Trade Organization (WTO), it is now being taken up as an agenda item, and legalistically, if we start having a discussion of this, we can make various debating points. Having said this, however, I would also like to say, after we established rules, other countries followed in coming up with fifty years, and I have a feeling that we may follow that line aside from the theory. I think that it is more normal for Japan to precede in the future. Under the WTO, there will certainly be legalistic discussion and talks, but on the other hand -- Beatles, Presley -- there were many wonderful, attractive musicians in those days. I think there should be a very good way established to express our respect to these people which is somewhat different from legalistic discussions and arguments. We would like to continue to watch and follow the trend of discussions going on in other advanced nations in the world.

VII. Korean Peninsula Energy Development Organization (KEDO)

Q: A question on KEDO. In your meeting, I believe you must have touched on the KEDO issue one way or another. The United States has played -- in connection with Congress, there have been difficulties for the United States to play a central role in KEDO. This time Japan decided to provide contributions as a special case. I believe that there will be a need for funding for many years to come, and also you will be proceeding to the construction of the light-water reactor itself as well. I wonder if KEDO can be successful in its mission, and what do you think Japan ought to do?

A: What I wish to say first is that this KEDO issue arose as a result of the United States providing a forum with North Korea to resolve the nuclear weapon development suspicions. I certainly appreciate, very highly, the efforts made by the United States in that process, and thanks to the advent of KEDO, we have been able to, more or less, set aside the nuclear issue. Having done that, the U.S., today, is engaged in debate between the Administration and Congress, and the U.S. is faced with difficulties regarding the supply of fuel oil. Lest there be any misunderstanding, let me say that yesterday, in the Cabinet meeting before leaving Tokyo, we decided to contribute US$19 million to a special fund for supporting KEDO. This is not for a fuel oil supply, there will be a fund under KEDO, a special fund, and the Japanese contribution will be for that fund for the purpose of overcoming the liquidity shortage. Please have that point understood properly. Now, we believe that among Japan, the United States and the Republic of Korea, the United States has fully played its role and also, not just the United States, but we hope the United States will double its efforts to see contributions by Europe as well as the Middle East. We also hope the United States will be able to provide the funds as early as possible so that there will not be any recurrence of the liquidity crises of KEDO.

VIII. Realignment, consolidation and reduction of U.S. military facilities in Okinawa (2)

Q: Getting back to Okinawa, do you feel you were able to sufficiently convey to Mr. Clinton the degree of domestic opposition within Okinawa to the base level, and were you able to convey the need to have flexibility in dealing with the Okinawa issue? Thank you.

A: I personally believe that President Clinton tried to address this matter in a very sincere manner. There certainly are sorrows and sufferings of the people of Okinawa, but even before my explaining them to President Clinton, he said that he felt regretful about the bad incident which happened last year and he spoke from his heart in a very frank manner. In that sense, I think the President stated himself that the U.S. would be coming to the table in very good faith, sincerely to talk over the matter. I think it is more a domestic issue, as it is a discussion between the two, and I think we, on our part, should make our own efforts on the domestic scene as well. As President Clinton himself today stated, I have confidence and trust that the United States will come to this matter in a very sincere manner.

IX. Japan-United States Framework Talks

Q: Let me ask you a question about how to perceive the economic talks under the Clinton Administration, the Framework Talks having taken place. Towards the end of the Miyazawa Administration this method was introduced, after that, there have been several Administrations in Japan. Are you going to maintain and continue this same process of economic talks -- namely the Framework Talks?

A: I am not the only person who can make a decision on this; it take two to tango, if I may say so in this connection. I believe what we have to do on our part is to take a positive and active role in deregulation measures, and now we have the WTO in place multilaterally so that we, as well as the United States, can take advantage of this existing WTO. So the situation surrounding our talks has changed very substantially. At the same time, I think private businesses should be more actively involved in our discussions and deal with one another. So, without the governments' involvement, I think it is better if the private sector, the businesses, would get together and discuss matters to arrive at mutually satisfactory resolutions. I think today, perhaps three hours ago, there was a semiconductor meeting of the industrial sectors of Japan and the United States in Honolulu, Hawaii. It was a top level meeting of semiconductor industries of both Japan and the United States. I have not received any formal report of the conclusion of that meeting, but as much as I can understand from the interim report of that discussion, the meeting was very successful. I hope very much that these meetings and exchanges will continue so as to lessen the importance and need of government-to-government discussions and government involvement.

X. Situation between the People's Republic of China and Taiwan (2)

Q: On the tension between China and Taiwan, on a matter which was raised earlier, the Chinese are planning a large scale military exercise and have been conducting various military maneuvers. I wonder if you took this up in your meeting, and what sort of views did you express on this matter?

A: As I said earlier, the present day situation around the Taiwan Strait was raised as a matter of discussion. I already said that. I said that we hope the two parties concerned will exercise restraint, and we hope that the tension will not rise further. I already said that. Nothing has been said beyond that.

XI. Realignment, consolidation and reduction of U.S. military facilities in Okinawa (3)

Q: Once again, on Okinawa, I am wondering if you can elaborate a little further. Between yourself and President Clinton, was there an explanation from President Clinton as to the strategic value of Okinawa, that it is to say, the need for the present troop level in Okinawa? Was there also an explanation about the need for 100,000 troops in East Asia?

A: No, there was not a discussion in that form. Rather at the time of the official visit in April and in the official- level discussions as part of the discussions on the Japan- United States Security Arrangements, I believe these matters will come up, but our meeting was limited to one hour today, so we did not delve into those details.

XII. Presidential elections in the United States

Q: I wonder if there was any discussion on the U.S. presidential election, and was there any discussion in regards to Mr. Buchanan?

A: Before being taken up to the venue of our Summit Meeting, when we arrived at the hotel, the two of us walked out to the garden. A member of the mass media there asked us that question. What I said in response is that this is something that should be decided by U.S. voters. We believe in free trade, we learned free trade from the United States, and we are continuing our efforts in nurturing this free trade system. I trust that the U.S. people will make a wise judgement. That ended my comment and during my meeting with Mr. Clinton, there was no discussion on that.

XIII. Realignment, consolidation and reduction of U.S. military facilities in Okinawa (4)

Q: My question is also about Okinawa. You mentioned Futenma as an installation. Does it mean that you would like to achieve an agreement during President Clinton's visit to Japan in April that there must be a resolution about Futenma? I just said this as an example, nothing more than that.

A: I do not think that there could be any more that I can add on this occasion. As I told you earlier, I just made a reference to Futenma as an illustration, as an example. The people of Okinawa Prefecture do have a very strong demand for the reversion of Futenma. There are many important issues, all of them are very important to them.

XIV. Japan's foreign policy and the Japan-United States Security Arrangements

Q: In your policy speech you touched upon the basis of foreign policy, saying that it's a proactive foreign policy, but before that, during the presidential election of the Liberal Democratic Party, you said that it should be an independent and a proactive policy. You said that the Japan- United States Security Arrangements is the lynchpin of the Japan-U.S. relationship, so in that regard, did you explain your position to President Clinton based upon these premises?

A: I am not sure if I understood your question. I personally consider the Japan-Unites States relationship extremely important. In particular, I was responsible for the auto negotiations last year and at that time Japan and the United States vied for support from other trading nations in the world. I tried my best to get support from other countries, and other countries said that they would support the Japanese position, but then they expressed their concerns about the future of the Japan-U.S. relationship. That experience tells me very strongly that we should firmly maintain a very good relationship between the two countries, which should be based, very firmly too, on the Japan-United States Security Arrangements. This is my firm conviction and this is not something I would borrow from briefings prepared by other people. Therefore, I think I was speaking my mind when I talked with President Clinton about this. I am confident that this was understood by President Clinton, and that I would try to get support and understanding from the Japanese people; thus, we would be able to come to some solution of the Okinawa issues.

Moderator: I suppose there are many people who would like to raise questions on this occasion, but unfortunately time is up. Therefore, I suggest that we conclude the Prime Minister's press conference. Thank you very much.

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Press Conference by Prime Minister Ryutaro Hashimoto on the Summit Meeting with President William Clinton of the United States

Initial Remarks by Prime Minister Ryutaro Hashimoto

Questions and Answers

I. Opening of the press conference

Initial Remarks by Prime Minister Ryutaro Hashimoto

II. Topics of discussion in the Summit Meeting with President William Clinton of the United States

Questions and Answers

III. Realignment, consolidation and reduction of U.S. military facilities in Okinawa (1)

IV. Economic issues between Japan and the United States

V. Situation between the People's Republic of China and Taiwan (1)

VI. Intellectual property rights

VII. Korean Peninsula Energy Development Organization (KEDO)

VIII. Realignment, consolidation and reduction of U.S. military facilities in Okinawa (2)

IX. Japan-United States Framework Talks

X. Situation between the People's Republic of China and Taiwan (2)

XI. Realignment, consolidation and reduction of U.S. military facilities in Okinawa (3)

XII. Presidential elections in the United States

XIII. Realignment, consolidation and reduction of U.S. military facilities in Okinawa (4)

XIV. Japan's foreign policy and the Japan-United States Security Arrangements

Press Conference by Prime Minister Ryutaro Hashimoto
on the Summit Meeting with President William Clinton of the United States