96. Memorandum From the President’s Assistant for National Security Affairs (Kissinger) to President Nixon1
SUBJECT
- Conclusion of the ECONCOM Meetings
The ECONCOM meeting with Japan concluded early this afternoon with an exchange of pleasantries and an expression on the part of both governments of their desire to work together to solve amicably their economic problems. The more salient aspects of the communiqué (Tab A)2 are:
—Japan stressed that the U.S. import surcharge had seriously affected the Japanese economy, and a request that it be removed as soon as possible since it would, if prolonged, encourage protectionism and threaten the free trade system.
—Japan indicated that the eight-point trade and investment liberalization program would be continued, although some adjustments would be necessary as a result of the changed situation following the announcement of the New Economic Policy.
—The U.S. expressed concern at Japanese trade and investment restrictions, and emphasized the importance of achieving full reciprocity in the U.S.-Japan economic relationship.
—The U.S. took the strong position that Japanese imbalance would require it to eliminate its remaining quotas and other important restrictions, as well as non-tariff barriers and export incentives, as rapidly as possible.
—The U.S. noted that the overly rapid expansion of exports can create serious dislocations and political problems, and pointed out the need for an orderly evolution of trade.
—Japan stated that within the context of its Eight-Point Program residual import quota restrictions, now numbering sixty items, would be reduced to forty items by the end of the month and that further liberalization in 1972 was under study.
[Page 321]—Japan expressed its strong apprehension over the increase of protectionist views in the United States.
—The U.S. and Japan agreed on the importance of promoting joint cultural activities, and the desirability of expanding joint U.S.-Japan research in the natural and social sciences and such fields as transportation, occupational health, and environmental problems.
On the whole discussions were amicable, but pointed up several unresolved economic issues, the most important being how much the yen will be revalued and how far Japan will move in the future to liberalize imports.
- Source: National Archives, Nixon Presidential Materials, NSC Files, NSC Institutional Files (H-Files), Box H–059, Senior Review Group Meetings, SRG Meeting—Japan 8/27/71). Confidential. Sent for information. A stamped notation on the memorandum indicates the President saw it.↩
- The communiqué of the U.S.-Japan Joint Committee on Trade and Economic Affairs is attached but not printed. It is printed in the Department of State Bulletin, October 4, 1971, pp. 350–353.↩