454. Memorandum of Conversation, December 2, between Rusk and Japanese Newsman Watanabe1
SUBJECT
- Hakone Talks
PARTICIPANTS
- The Secretary
- Mr. Zenichiro Watanabe, Foreign News Editor, Mainichi Shimbun
- Mr. Minoru Omori, Bureau Chief, Washington Office Mainichi Shimbun
- Mr. Henry L.T. Koren, Director, Northeast Asian Affairs, State
- Mr. John M. Gregory, Jr., Far East Public Affairs, State
- Mr. James J. Wickel, Language Services, State
Mr. Watanabe stated that he felt that the attitudes being shown in the United States on restrictions on textile imports and bidding on AID fertilizer contracts had the effect of blunting the promise shown in the Ikeda-Kennedy Communiqué and the Hakone Conference.
In reply the Secretary indicated that on the textile matter we believe that the Japanese complaint is legitimate because of the good will shown by Japan in imposing voluntary export controls while other textile producers were exporting all they could to the United States. We are interested in helping Japan to enter other markets. We must now ask Congress for new kinds of trade authority to resolve problems like the present one of Japanese textiles. The Secretary said that the fertilizer matter is related to the gold-flow problem. He realized Japan was on the other side of the gold flow but we have to make our adjustments relative to the overall position of our gold holdings. He further commented that Japan is in a period of vigorous growth in which it needs capital and equipment for its ten-year plan. We cannot keep up with the adjustments needed to keep our trade with Japan balanced while Japan is running so fast. Another part of the problem is that Japan does not import what it produces and that it does not have domestic complaints about import competition. On the other hand, in the United States Japanese goods are very obvious to our people when they are displayed in stores and shops. No one sees things like the generating plants and capital goods that we export to Japan. [Typeset Page 1814] United States importers [Facsimile Page 2] are not vocal but the people who think they are being injured by Japanese imports are very vocal. We hope to try between our Governments to anticipate probable trade levels in order to balance them. But in the short run, we cannot balance our trade levels item for item. However, we shall do our best to work them out.
The Secretary said he wanted to impress Mr. Watanabe with his disbelief that a decision effecting one fertilizer transaction since the Hakone Conference erases the effect of Hakone. He observed that free nations are always trying to do more. The dynamism of our economics precludes complete harmony. We must remember that while one item, such as fertilizer, is disrupted, thousands of other items are being traded equitably.
- Trade with Japan. Official Use Only. 2 pp. Department of State, Secretary’s Memoranda of Conversation: Lot 65 D 330.↩