Foreign Relations of the United States, 1964–1968, Volume IX, International Development and Economic Defense Policy; Commodities

251. Telegram From the Embassy in Japan to the Department of State¹

Tokyo, February 11, 1965, 5 p.m.

2515. Reference: Embtel 2424.² Wool Textiles. In response to FonOff and MITI request for further discussion and clarification of President’s proposal for a bilateral wool textile meeting prior to Ambassador’s raising issue at higher levels, EconMin met with Nakayama (Director EAB FonOff) and Yoshioka (Chief Textile Export Section, MITI) February 10.

Nakayama said GOJ record this portion of discussion between President and Prime Minister somewhat unclear but GOJ had understood that Sato had proposed US and Japan wool textile industry meeting only, without involvement govt reps, had further understood that purpose of meeting was to permit frank exchange of views between two industries which might contribute to reasonable solution this difficult problem.

Nakayama explained that clarification of US proposal given Yasukawa by DCM last week (reftel) added new complications for Japanese side, particularly since DCM had indicated that USG would want to explore possibility of multilateral meeting of govts on wool textiles at such meeting. Nakayama emphasized that GOJ remains as in past adamantly opposed to international arrangements on products as well as to any multilateral conferences which would aim toward such arrangements. Therefore discussion either possibility would be useless and lead only to embarrassment and possibly acrimony. (In “off the record” comment, Nakayama noted that such meeting between govt reps would also create difficulties for GOJ because it has agreed with UK and Italy to hold solid line in opposition to any US attempts aimed toward an international arrangement on wool textiles. He said that, as result of Sakarauchi announcement of new USG approach on wool textiles, UK has already asked GOJ whether it is softening its position on this issue—protect source.)

EconMin noted that GOJ agreement to meet would not imply any prior commitments by either side to methods of resolving problem but merely provide opportunity for discussion various possibilities. Added that meeting solely of industry reps would be difficult for US side because of US anti-trust laws, in addition to not satisfying necessity of two govts coming to grips with problem.

Nakayama and MITI rep acknowledged potential USG problem if GOJ insisted on meeting of industry reps only and, after MITI rep cleared by phone with his ministry, made following counter-proposal:

1. GOJ would greatly prefer meeting of industry reps only and would be able to obtain Japanese industry agreement to such meeting without difficulty.

2. However, if USG insists on joint meeting with govt and industry reps, GOJ “has no reason to refuse” but will have to consult again with industry since latter has as yet no knowledge of this clarification of proposal. GOJ cannot assure industry agreement but believes it probable.

3. In either case, GOJ must insist on prior agreement that possibilities of a multilateral conference and/or an international arrangement on wool textiles not be raised or discussed at the meeting.

4. Provided the USG agrees to this condition, GOJ wishes meeting be held in Tokyo.

Nakayama and MITI rep said that while awaiting USG response to GOJ counter-proposal, MITI would make preliminary soundings of industry on its attitude toward joint meeting with govt reps.

Instructions requested.

Reischauer

1. Source: Department of State, Central Files, INCO–WOOL 17 US–JAPAN. Confidential.
2. Telegram 2424 from Tokyo, February 5, described a meeting on February 4 between Charge Emmerson and the Director of the American Affairs Bureau of the Japanese Foreign Office, at which Emmerson was asked whether the United States would insist on a meeting. (Ibid.)