Aug 3, agency response to economic sections of nssm 122

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lconomic sections

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DXPARTI.IIiIT OF STATE cornlENfs oN itssrr_122

I! considering tne econoric issues raised in {SS:,r-122. tn6 Deparutnt of sEaEe Lelicves EhaL Lhe LoIloui,g poinE;, not includea l. the Nssi,r, shoutd atso be considerea:' 1. us ifports fron Japan afe six-tenurs of one PelcenL oi orL.rora_ ol our o,o.u. .o- ot roods, _s pc.ce-i. or ouinpolts from al.1 sources. nhile expolts are inpoltant, imports are also.

I porEs co,t!ibu-e ro rne s.)c19rn or i.c mE( cdn economy in !-..rar, a.d tne,rct:.(e of.the Axc!icar co.rutre: in p.rEicut.,. jhey rarse r-c] udses

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!o eviaeDce ',has been presentcd that inDo.ts I'oo Jrpan jure ,. e Mjrrcar .onon.. in ,\rerr.nn rn.llstrv i. palticula!. -- oder rhan textil;s anc sreet, lhich are hot considered tn tne Nsstl. $hile inports affect enplorfrenr in oarticuld Us irdustliesr the overall 1evel of US enploymeat rand uneaployrenLr .s noL siqnitica.tLy afre.reo Dy 'or".9n rrade. Tn ]t6sr vhen US iroo-rs frm a" sorlc.s lose bv or unprecedenLed 24 pe.cc, L, rjs Jnenolo\ rcnt felt to its Io:es! Iever 1n 15 yo.rs, Us intlation undoubredly has contribured to the trade deficit vith ,rapan.

Ore-third o! Japanese exports to rhe United states ale lestlictea by volunrary conrrols.

Japah is no lonqer c toH-qaqe rdct Ja6rn's uases dle rouqhty Et,c sime "s those in the U.K.

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J.pan.-a jnport tjbL!attza,ion noL reJJLy begl^ unti1t9o3.. In Ehc -..Iy d:d isrxties Ex-ie w.s. so,ie 1:ber.IiTat_on, moqtlt oDurrrq. the n:d.60 s, v-!rL!_ly 10 lijr-,.tizrrro1 b.q nn:nq rn rp!rI, t963 qe,Japrrosc ha/e reroveJ duora resL;lcLions on an !nc!eâ‚Źslnq -..0be, of iLe7.. Thesa vo-_d hot in rhe.o)Lra,. sraLjsLr.s be-o!::,I:::td:g -e.0. ronseqDe..Lry, no ,Ijsrons .bour rhi ,eltect..eness_ ,oLa oh pr.o! Eo ?:"*"!:: .,"-. :: r:b^, ._:21E_o bcs.q use 1oo3 a.o.969 :-.-

SECRET

C@men, on NssM 122

- parr Tvo: us -Japan lDrart .t 1/30t1r )

Eco,omic Relations

Ietk",rr aI irJt4 ion is d h.gh-.-..r.., obJ,"..vc oLLie goverueni, ^ objccriv" .! nas be<n \r .too ro raFe .,.1.fi-;. "r ."sr r.hP,rd.iry, oJ oL'Pu, .iuspd plfar / bv .osr ,.crors and oy r,e upv,.o n.ri n.h .ffi:is rlom pe!sr. nt :nJl:r:on"ry Fap r.-,.on, B n rrred or !... .r e s -ao5_6. ihPorrs DI3. - 51,',t a.'..:nI!"ri.-a'y ,ore. b) p-oq di.5 loair-(os. sood.3nd bv _"*,,s..-p"..r,"" p,"_r;," on doaeB i\ prodJce.s .o hoto ooM .osr. p,..;" , i," ."_p"t ,,". ".a pr'ssure oI mpott. ma[es rrpo.srbie toajiowaror, ..p:d "]pa.s.or oI output arrl emplolaent &an r6!rd orLerrvise be c.nsisien! virh ;!. antir.Jbrrcn oo_-crir*. CMp. ritjv,. :rForre a." no / r ra.Lo|o! !os.rlve

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