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The 36th Annual U.S.-Japan Business Conference Joint Statement
July 13, 1999 San Francisco, CA
The 36th Annual U.S.-Japan Business Conference was held with more than 80 Japanese and U.S. business leaders in attendance. A broad range of issues concerning Japan-U.S. relations were discussed, including macroeconomic fundamentals and exchange rates, deregulation and market access, foreign direct investment (FDI), electronic commerce and harmonization.
- 1. Role of the U.S.-Japan Business Council and Japan-U.S. Business Council
- The Councils have been very effective in building business relationships and consensus. In addition, the Councils will now emphasize their work as an instrument of policy change. This will be done by working jointly with policy leaders, as well as unilaterally with government officials of their respective countries. The goal is to increase overall competition and the resulting productivity and economic growth in the U.S. and Japan.
The Councils will establish common proactive business objectives, based upon a foundation of common definitions. Agreeing to disagree where appropriate, differences as well as similarities will be identified, and the Councils will understand their influence on policy change.
- 2. Japanese Economy
- Both Councils hope that the Japanese recovery will continue and be strong enough to reduce unemployment. Corporate restructuring and other supply side policies can increase long-run productivity. Deregulation and market opening can facilitate the creation of new businesses, including venture businesses, and therefore increase employment.
The Japanese government should also seek to promote FDI as a source of employment, increased competitiveness, domestic growth and innovation to benefit Japanese consumers.
- 3. U.S. Economy
- Both Councils share a concern regarding the U.S. trade imbalance and low household savings rate. The Japan Council in particular is concerned about the rapid rise of the U.S. stock market and the possibility of the effects of a correction.
However, the U.S. Council believes that the U.S. open market, further deregulation, continuing direct foreign investment, and strong competition policy bodes well for continuing U.S. economic health.
- 4. Exchange Rates and Financial Markets
- Both Councils agreed on the need to maintain a stable exchange rate. To this end, both Councils urge the implementation of measures such as the monitoring of hedge funds.
- 5. WTO
- The U.S. and Japan should take leadership in the new round of WTO, including the formulation of multilateral investment rules, to avoid any kind of protectionism whether in the form of tariff or non-tariff barriers.
Representing key components of the business sectors of the world’s two largest economies, members of both Councils recommend that the U.S. and Japan develop a set of common objectives for the new round of trade negotiations to be launched at the WTO Seattle ministerial. These objectives should provide for progress in the traditional areas of trade liberalization (i.e., reduction of tariff and non-tariff barriers), as well as in such areas as services, electronic commerce and pro-competitive regulatory reform.
Such reform would promote regulatory principles that enhance product/price competition, consumer choice, and would ensure effective and fair competition.
- 6. E-Commerce
- Both Councils reaffirmed the importance of private sector leadership in the development of Electronic Commerce (EC). Accordingly, a Joint Statement on Electronic Commerce was published. A distribution campaign will be undertaken by both Councils to effect global recognition of these recommendations.
Both Councils will continue to monitor further developments in Electronic Commerce.
- 7. Harmonizatione
- ・The United States and Japan should make further efforts to promote the global harmonization of business rules, including those governing card fraud. To that end, a Joint Statement on Fraudulent Card Use was issued.
・In that it is extremely difficult to get permission for business aircraft to land and depart Japanese airports, the Councils request similar operating conditions that exist in most other parts of the world. The improved access for business aircraft will yield significant benefit to the economy of both countries.
・Harmonization of accounting standards should be studied.