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Updated Framework for Handling U.S.-Japan Auto and Auto Parts Issues

27 December 2000

Japan's MITI Minister Calls for Updated Framework for Handling U.S.-Japan Auto and Auto Parts Issues, Reflecting the Globalization of these Industries

    NEW YORK--Dec. 26, 2000--Commenting on the meetings in San Francisco last week on the impending expiration of the U.S.-Japan auto and auto parts agreement ("Measures by the Government of Japan and the Government of the United States regarding Auto and Auto Parts"), Takeo Hiranuma, Japan's Minister of International Trade & Industry, expressed regret that the U.S. side did not accept Japan's proposal for a new bilateral dialogue mechanism and stressed the need for an updated approach to dealing with auto trade and auto issues reflecting today's changed circumstances.
    "The environment surrounding the auto and auto parts industries has changed dramatically as a result of globalization," said Mr. Hiranuma. "In fact, seven out of eleven Japanese auto manufacturers are now affiliated with foreign manufacturers." He added that the rapid progress of information technology (IT) is further transforming the automotive industry, with an efficiency-oriented parts procurement system that does not discriminate between domestic and international suppliers spreading throughout the industry.
    Referring to Japan's proposal, Mr. Hiranuma said that a new modality for bilateral dialogue would not only permit a more flexible response to the changing industry environment but would also facilitate broad exchanges on shared agendas. He added that Japan was prepared to discuss the proposed group's agenda as part of the discussion on how to establish a framework for a new U.S.-Japan dialogue mechanism.
    On the other hand, in light of the sweeping changes that have transformed the auto industry on a global basis, Mr. Hiranuma asserted that the "Measures" framework, which was adopted in 1995 and focuses narrowly on bilateral trade and procurement issues, has outlived its significance.
    In consideration of the importance of this matter, said Mr. Hiranuma, Japan stands ready to have further discussions with the U.S. "at any level, at any time."