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Deliver on Trade Promises, Reagan Urges Nakasone

October 26, 1985|ELEANOR CLIFT | Times Staff Writer

NEW YORK — President Reagan told Japanese Prime Minister Yasuhiro Nakasone on Friday that he will do everything he can "to avoid going down the road of protectionism." But White House officials later privately warned that time is running out for Reagan to make good on that pledge because congressional sentiment for protectionist measures is still running high.

The President, meeting separately with Nakasone after a mini-summit of allied leaders here, emphasized to the prime minister "the importance of turning words into deeds" and urged him to deliver on some of his promises to reduce trade barriers by the end of the year, according to a U.S. official.

Before leaving New York, where he delivered a major foreign policy speech at the United Nations this week, Reagan also met privately with West German Chancellor Helmut Kohl. Shortly afterward, President and Mrs. Reagan left for a weekend at Camp David, Md.

White House spokesman Larry Speakes said that the President was "extremely pleased" as a result of three days of talks with world leaders who were here to observe the 40th anniversary of the United Nations.

While Reagan was in New York, his Administration barely beat back a congressional attempt to tack a protectionist textile bill onto budget legislation. And a White House official said Friday that Reagan's ability to withstand future assaults on his free-trade policy "depends on how responsive the Japanese are."

If ongoing talks don't bear fruit soon, this official predicted, Reagan could lose the protectionist battle. "The time frame is not very large," he observed.

When Reagan met with Nakasone last January in Los Angeles, the prime minister promised to press for Japanese concessions to U.S. traders in telecommunications, drugs and medical supplies, electronics and forest products. Almost a year later, there is only a preliminary agreement on telecommunications equipment.

An official briefing reporters at the Waldorf-Astoria Hotel, where the President stayed, said the Administration is "most unhappy" about the lack of progress on forest products. The official said Nakasone told Reagan that he would strive for agreements by the end of the year "where at all possible," and that he would add other goods to the list of negotiable items.

But the Administration is not optimistic that Nakasone can deliver even though, top officials concede, he has been more amenable to amending Japan's rigid trade practices than any of his predecessors.

'Buy American' Appeal

At Reagan's urging, Nakasone has been pushing for more open markets, even making a nationwide television address asking his people to "buy American," a dramatic first in Japan.

To demonstrate his good intentions, Nakasone reminded Reagan that he has appointed a high-level study group headed by the former governor of the Bank of Japan to assist him in the trade turnaround. The group's report is due at the end of March.

"We know it's difficult," a top White House aide said, "but no one has the luxury of time." The Japanese trade surplus with the United States is expected to exceed $50 billion this year.

An Administration official did, however, praise Japanese efforts to expand Japan's foreign aid program. Tokyo recently set a target of $40 billion in foreign assistance over seven years, twice the current level.

The Reagan Administration long has urged the Japanese to assume more of the global responsibilities that go with economic success. And a U.S. official was pleased to report that Japanese aid to Latin America has grown from about $120 million in 1980 to more than $250 million today. The official also noted that Japan granted Mexico $50 million after last month's earthquakes that the Mexican government could spend on whatever it needed, not just on Japanese goods.

"That's a decision that we welcome," the official said.

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