Faced with a mammoth annual trade deficit-predicted to reach 30 billion dollars by the end of this year-the United States is urgently trying to redress the balance with its major trading partners, in particular Japan.
Faced with a mammoth annual trade deficit-predicted to reach 30 billion dollars by the end of this year-the United States is urgently trying to redress the balance with its major trading partners, in particular Japan. The value of Japanese exports to the United States is causing considerable concern to U.S. trade officials, who will get to grips with the problem next week when representatives of the two countries meet in Washington.
SYNOPSIS: Since the end of World War Two Japan and the United States have enjoyed increasing social, political and economic ties. As Japan's economic status has risen, so too have the value of its goods and the wealth of its people. Every year, millions of Japanese are able to afford overseas holidays, and many go to the United States.
This trend has increased recently as the Japanese yen's value on world exchange markets has risen sharply. During the past year the U.S. dollar has depreciated by 22 percent in relation to the yen.
The value of a national currency on the world markets is reflected in external trade figures. In the case of Japan, exports to the United States have risen at an alarming rate-alarming that is for United States trade officials, who are faced with an increasingly large bill for imports while the value of their exports fall. In reaction to this they have urged Japan to lift its import control legislation or face the consequences-a clampdown on Japanese exports to the United States.
80 percent of all cars sold in the western United States come from Japan. It is calculated that they account for some 40 percent of the gross trade imbalance. But it is in the field of electrical and electronic consumer goods that the Japanese are most competitive. Their production costs are lower and consequently they enjoy a thriving market. American electrical industry officials are concerned about this and are seeking some action in Washington-either to restrict the flow of Japanese goods or increase their own share of the market.
In shops and stores on the west coast of the United States the average American can hardly fail to notice the extent to which the Japanese have flooded the American market with their goods. The real effect of Japan's industrial prowes means cheaper television sets and electrical goods for the American consumer, a drop in sales for American manufacturers, and ultimately, higher unemployment.