On-the-Record Briefing 14 November 1998

Status: : ON THE RECORD
Speakers: : Ms. Mikie Kiyoi
(Spokesperson for Minister for Foreign Affairs Masahiko Koumura)
Date : 14 November 1998
Time : 19:34 to 20:06
Location : Cinta Alam #11/12, Level 3M, Mines IMC
Kuala Lumpur, Malaysia
Attendants : Approximately 30
  1. Overview of the day's events
  2. Meeting between Japanese Minister for Foreign Affairs Masahiko Koumura and United States Trade Representative Charlene Barshefsky
  3. Meeting between Japanese Minister for Foreign Affairs Masahiko Koumura and Chinese Minister of Foreign Affairs Tang Jiaxuan
  4. Japan's flexibility in the EVSL negotiations
  5. Items for discussion during President Jiang Zemin's visit
  6. Character of the American approach to trade negotiations
  7. The Taiwan issue
  8. Support for Japan's position in APEC
  9. Implementation of the Miyazawa Initiative
  10. Funding for the Miyazawa Initiative
  11. Conditionality of the Miyazawa Initiative
  12. Japan's guarantee of Asian bonds

  1. Overview of the day's events

    Official of the International Press Division of the Ministry of Foreign Affairs: Good evening, ladies and gentlemen. We are now going to start our on-the-record press briefing by the Japanese Delegation. The briefer is Ms. Mikie Kiyoi, Spokesperson for the Minister for Foreign Affairs. Ms. Mikie Kiyoi, Spokesperson for Minister for Foreign Affairs Masahiko Koumura: Good evening, ladies and gentlemen. Thank you for coming. Today was a very tough day for my minister, Minister Koumura. Earlier this morning, he met U.S. Trade Representative Madame Charlene Barshefsky around 7:30 in the morning -- I hope he took breakfast before that -- and then he participated in the informal discussions, focusing on the item of most interest to you, the EVSL. Then he also attended the afternoon session of the APEC Ministerial Meeting, and around 17:30 this afternoon, he met his counterpart from China, Foreign Minister Tang Jiaxuan. As you know, President Jiang Zemin of China is expected to come to Japan from 25 November. They had a very good and fruitful discussion. So let me brief you quickly on the salient points of the first meeting of today, between Mr. Koumura and Madame Barshefsky.

  2. Meeting between Japanese Minister for Foreign Affairs Masahiko Koumura and United StatesTrade Representative Charlene Barshefsky

    A: Actually, Madame Barshefsky started the talks, and from the beginning to the end, she only talked about EVSL, and especially the two sectors of which you are so well aware. The media had reported that "Japan has gone around the region, offering assistance in the form of money to countries willing to back away from the initiative. Japan is actively discouraging countries from liberalizing. That is terribly disturbing and distractive." Well, she did not say this "offering assistance," but she clearly said that Japan was actively discouraging countries from liberalizing, which was "disturbing."

    Mr. Koumura calmly replied that Japan's position is clear: we are complying with the principle of voluntarism. Voluntarism applies to Japan, but also to other member economies. Therefore, if other member economies would voluntarily like to participate in the nine sectors, then Japan has no intention of discouraging other member economies from doing so. Rather, he stated, "The fact that the U.S. spreads around its argument, that non-participation of Japan would result in other economies opting out, will virtually lead to other economies' non-participation -- that is a major concern of Japan." He clearly said that Japan has never discouraged other member economies from voluntarily participating in the nine sectors under the EVSL.

    In that connection, Minister Koumura explained the three priorities of Japan's stance in this APEC Meeting. First, the most important and urgent thing is to revitalize the Japanese economy and stimulate an economy led by domestic demand. The second priority is to help out other Asian economies hit by the crisis. Japan has already announced and is implementing the world's largest assistance program, which amounts to $44 billion, and under the name of the Miyazawa Initiative, we have additionally announced another $30 billion in assistance. The third priority, he said, was promoting the liberalization and facilitation of trade and investment. And he recognized that EVSL is an important part of the third priority, but he clearly explained that after serious deliberation within the Japanese Government, the Japanese Governmenthad decided not to participate in the forestry and fisheries sectors, as Japan has already substantially reduced the tariff rate under the Uruguay Round. Therefore, it is very difficult for Japan to take further tariff and non-tariff measures. Nevertheless, Japan has the intention of participating in the WTO negotiations, which will start in the year 2000, as a comprehensive trade package.

    Madame Barshefsky replied that the United States also has politically sensitive items. She particularly pointed out the recent increase of the U.S. trade deficit. Mr. Koumura explained that the reason why the trade gap between the United States and Japan is enlarging is because, primarily, of the lack of domestic demand of Japan, since the Japanese economy is in bad shape. Nevertheless, it is unfair to say that Japan is closing its market to these two items. As tangible evidence, Japan is the world's largest net importer of these two products: 80% of forestry products are imported, and 40% of fisheries products are also imported. In particular, the tariff rate of forestry products in Japan is lower than that of the U.S.

    Madame Barshefsky explained that American politicians are not economists. I understand she implied that as they are not economists, they want to see some political message from other member economies at APEC. That is, in fact, all the major salient points of the Barshefsky-Koumura discussion this morning. Perhaps you are already aware of this morning's informal session on the EVSL. Dato' Seri Rafidah Aziz, the Chairperson of this meeting, has already given a press conference, so maybe it's better for me not to say anything. If there are any questions from your side, I would be happy to reply to those later.

    Related Information (Japan-U.S. Relations)

  3. Meeting between Japanese Minister for Foreign Affairs Masahiko Koumura and Chinese Minister of Foreign Affairs Tang Jiaxuan

    A: As to the Japan-China bilateral talks, Minister Tang explained in detail the recent positive developments between the People's Republic of China and Chinese Taipei. As you know, there have been some substantive talks between these two economies as APEC members. Therefore he explained in great detail the background of these recent developments. As to President Jiang Zemin's visit to Japan, it is in 10 days. Perhaps you are very interested in the so-called Joint Declaration that will be issued as a result of this historic visit. The foreign ministers of both Japan and China agreed that both China and Japan would like to work hard to have a very good, positive document.

    That is all that I wanted to say at the outset, and now I am delighted to answer your questions.

    Official of the International Press Division of the Ministry of Foreign Affairs: Are there any questions? Please clearly state your name and affiliation.

    Related Information (Japan-China Relations)

  4. Japan's flexibility in the EVSL negotiations

    Q: Do you think that there is any chance of a compromise on the question of forestry and fisheries, and what sort of direction might that compromise take? For example, moving that whole package into the WTO, delaying the timetable for some of the products? In other words, is Japan trying to find a compromise, and in what direction are you looking?

    A: There are several interesting proposals, and the Ministers are working on that, and the Senior Officials are also discussing it actively to try to find a sort of compromise. As I said, Japan's stance is that the WTO is an appropriate, perhaps the most appropriate, setting to negotiate this kind of thing in a comprehensive manner. We know that the next negotiations will start quite shortly, in the year 2000. Therefore we are ready to participate and include these two sectors -- the forestry and fisheries sectors -- in the discussions which will start in the near future. So this stance is one of Japan's basic positions.

  5. Items for discussion during President Jiang Zemin's visit

    Q: I want to know, during President Jiang Zemin's visit to Japan, will the Japanese Government show any apologies or actions of regret for what it did during the war?

    A: I cannot say anything at this stage. Both sides are consulting as to what would be the best theme for those two countries. So it is premature for me to say anything on this issue.

    Related Information (Japan-China Relations)

  6. Character of the American approach to trade negotiations

    Q: Mrs. Barshefsky accused Japan last night of using aid money to try to buy support from countries in the region and persuade them to back away from their trade liberalization commitments. What is Japan's response to that allegation?

    A: My reply is quite clear. It is groundless accusation and defamation. Japan has been helping the other Asian economies, despite its own problems back home since the start of the Asian financial crisis, which is now one year old. It is well known that the Asian economies do need assistance in various forms, whether financial or intellectual or technical support. By saying that Japan is buying some favors from other member economies, that is quite disturbing and destructive to us in Japan. We are also very unhappy that our good intention is interpreted in this evil manner.

    Q: Given what you've said, and what's been happening here, is Japan starting maybe to think that the U.S. is just using this as a stick for beating Japan? Just as a way of putting diplomatic pressure on Japan? Is this just an excuse for the Americans to put pressure on Japan?

    A: America has its own agenda. It is able to push through some things, so it may have the freedom to use various means to achieve its own goals. But spreading around a groundless rumor is simply counterproductive, and that is quite regrettable.

  7. The Taiwan issue

    Q: During the talk with the Chinese minister, did Minister Tang ask Japan to put the Taiwan issue into the Joint Statement?

    A: As I said at the beginning, Mr. Tang explained in a very lengthy manner the recent positive developments between mainland China and Chinese Taipei. He reiterated China's well-known position that the Taiwan issue is a domestic matter.

    Related Information (Japan-China Relations)

  8. Support for Japan's position in APEC

    Q: How much support do you have from other member countries for your position?

    A: Maybe other member economies remember clearly the principle of voluntarism, which is clearly set out in the documents agreed upon at Vancouver last year. So several economies have reiterated the principle of voluntarism and flexibility. I cannot say how many countries, but there are member economies which stick to that principle, too.

  9. Implementation of the Miyazawa Initiative

    Q: [Inaudible question about the Miyazawa Initiative]

    A: In any case, the Ministerial Meeting of APEC consists of trade ministers and foreign ministers, and this Miyazawa Initiative, as its name clearly says-- Miyazawa is our finance minister's name -- relates to finance, so there were no talks about the Miyazawa Initiative. It is not a "Miyazawa Loan"; it should be called the Miyazawa Initiative or Miyazawa Scheme, because it contains various measures. Therefore I don't think there is any allocation of funds to any specific countries so far. Anyway, as I said in yesterday's briefing, the Miyazawa Initiative will be implemented based on the technical experts' missions and the findings. We are going to send a fact-finding mission. We have already sent a mission to Thailand and Indonesia recently; another mission will be sent to Malaysia and other countries. Therefore, without knowing the outcome of these fact-finding technical missions, it is too early, and it is impossible to say that such-and-such an amount will be allocated to such and-such a country.

    Q: So each recipient country would have to convince Japan of the seriousness of the crisis before any amount could be given?

    A: Yes, it all depends on the needs.

  10. Funding for the Miyazawa Initiative

    Q: I understand that the Americans are likely to propose rescheduling debts at this conference. There have been some suggestions that that scheme might involve presumed money made available under the Miyazawa Plan, which would help back up the rescheduling. Would Japan object to this sort of use of the funds? Would it fit in with Japan's intentions in designing the plan?

    A: As you know, I am not a spokesperson of the Ministry of Finance, but I have been briefed by my colleagues at the Ministry of Finance. The Miyazawa Initiative was announced in early October, within the framework of the G-7 Finance Ministers' Meeting. At the very beginning, Japan made it clear that we welcome other economies' contribution in this kind of initiative, preferably by financial contribution, but also intellectual contributions are welcome. Japan has no intention of monopolizing this initiative, because the effective implementation of this initiative is very good and very helpful for this region, and as a result, for the rest of the international community. So we are very open-minded. As to the banking restructuring, the Miyazawa Initiative already includes some measures to offer a guarantee of sovereign bonds to be issued by Asian member countries with a view to recapitalizing ailing banks in these countries. So some floating idea delivered through some American media regarding the banking restructuring is already included in the Miyazawa Initiative, Japan has an idea and Japan has money as well.

  11. Conditionality of the Miyazawa Initiative

    Q: With the Miyazawa Initiative, can you tell me whether Japan will attach reform conditions to the granting of aid to these five countries and any others that might come along? The aid through the Miyazawa Initiative, will that require those countries to undertake economic reforms, and if so, what kind of conditionality are you going to attach to it?

    A: This initiative includes restructuring; it will mainly attack the debt problems of private companies of Asian countries. The reducing of the debt problem of private companies, and also the stabilization of the financial systems of these countries -- that is one of the tracks of this initiative.

    Q: I understand that. But will Japan say, to Thailand for instance, "You must, in order to access the Miyazawa package, you must reform your economy in this particular way?" Or will it say to a private company, "You must improve your balance sheet reporting?" Or something like that -- are there reform conditions that are going to be attached to this package? I mean reform of the economies that are getting aid.

    A: Reform of the economic system of the Asian countries is already contained in the IMF conditionalities. If Japan, under the Miyazawa Initiative, proposed a completely opposite direction to the IMF principles, the result would be disastrous. We do need cooperation with other initiatives,whether under the IMF or World Bank or other bilateral lending countries. Thereforethe Miyazawa Initiative will be implemented in line with those reasonably and widely accepted principles.

  12. Japan's guarantee of Asian bonds

    Q: May I just come back to the question you were asked earlier, about whether Japan is prepared to put any of its money behind an American initiative to help guarantee the bonds that Asian countries may issue to rescue their troubled private-sector companies?

    A: It is premature for me to answer your question. The floating idea which you mentioned came to me only through some American media. I cannot reply to your question based on this news without knowing the real intention of the U.S. On the 16th, Prime Minister Keizo Obuchi is arriving in Kuala Lumpur, and he is accompanied by Vice-Finance Minister Eisuke Sakakibara. So I think he would be a more relevant person than I to reply to your question. Thank you.


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