US-Japan and US-China Relations

Résumé du document

The development of the Asian economy (China and Japan in particular), has had a great impact on the US-Japan and US-China relationship. Fears of a trade war between the world's two largest economies have worsened since the implementation of the GATT (1988-1993). The relations with the China is becoming an increasingly complicated due to its emergence as the world's largest Emerging Market'.

Extraits

[...] Hidden stakes Indeed, all this "muscle-flexing" is mostly directed at voters. Rumors of a "trade war " have been continuously growing since the Mid-term elections campaign of 1994, and strengthened in 1995 as General Elections approached. It seems Clinton's administration intended at exploiting latent "Asia- bashing feelings" in the population : in of the Americans felt the greatest threat to National Security was the Japanese economic power. In turn, only of the Japanese found the Americans "friendly " in 1995 (average over last 11 years : 59%). [...]

[...] The Chinese situation is different since its economy is not as open as Japan's. But it needs exports for its modernization, and America makes up of them. American technology is also being used in nuclear and aircraft industries, since the ban has been lifted. Washington's support is also indispensable if China wants to integrate the world community through the WTO or other organizations. In short, the People's Republic of China (PRC) necessitates acceptable relations with the USA if it wants to modernize. [...]

[...] The Japanese distribution system and vertical integration of local corporations (known as "keiretsu") are also accused of perverting competition. This explains why the US asked for precise "imports targets", or Voluntary Imports Expansion, easier to control and supposedly more efficient in dealing with these treacherous Japanese. Dumping and copyrights (25 years in Japan for the WTO) were also part of the dispute, but to a much lesser extent. The bad guy: China Since the Tien An Men slaughter, the US had imposed a ban on some materials to be sold to China, and refused to delink human rights from trade negotiations until 1994, as its integration in the World Economy was supposed to require her to abide by some common rules in the treating of her citizens. [...]

[...] May 1994: China is granted MFN. August 1994: Partial agreement on trade with Japan which accepts the opening of some specific markets (insurance, telecom public market, medical equipment). May 1995: Ultimatum to Japan, required to open its car market. June 1995: On the eve of the end of this ultimatum, the Japanese administration accepts to open its car-market. November 1995: Talks between Jiang Zemin and Bill Clinton in New-York. April 1996: Signature of an agreement of military cooperation between Japan and the USA, redefining the framework of the system of security within the Asia-Pacific area. [...]

[...] This might have provided the US another leverage: undersecretary for international trade J. Gartner subtly said he was not going to blackmail Japan but stressed that "economic tensions slowly undercut the trust" between both countries. But in fact, the security treaty was confirmed in April 1996. So the US has it hard to conciliate political and economic interests A policy which misses the point From an economic point of view Free trade or managed trade? During their negotiations with the Japanese, American officials steadily tried to impose Voluntary Exports Restrictions and Voluntary Import Expansions on their partner. [...]