January 19, 1988
Death of Daisuke Yamauchi
Before we turn to matters of policy, let me express to you my condolences on the untimely loss of the president of the Mainichi Newspapers, Mr. Daisuke Yamauchi. Mr. Yamauchi knew the United States well, and as Mainichi's bureau chief in Washington, and before that as one of the first Japanese participants in the Fulbright fellowship program, he fostered the close ties that have come to mark our countries' mutual relations over the years. He was also one of the founders of the Fulbright Alumni Association in Japan and its first president. Mr. Yamauchi was an outstanding journalist and a great friend of the United States. He will be missed.
Q. First of all, please allow me, Mr. President, to congratulate you on your signing of the INF treaty at the U.S. - U.S.S.R. summit. We, the Japanese people, are especially grateful that the principle of global zero has prevailed.
Now, how would you assess the present status of the START negotiations? Will the treaty be ready for signature when you visit Moscow? On the other hand, some of us in Japan feel that the advent of the new superpower relationship might mean the United States and the U.S.S.R. are starting to talk over our heads, so to speak. Would you tell me how you look at the superpower relationship from now on as well as its implications to the U.S. allies?
The President. My recent meeting with General Secretary Gorbachev in Washington resulted in considerable progress toward implementing our goal of 50-percent reductions in U.S. and Soviet strategic offensive arms. We agreed that we would instruct our negotiators in Geneva to work toward the completion of a treaty and related documents at the earliest possible date -- if possible, in time for signature during our meeting in Moscow in the first half of 1988.
I don't wish to underestimate the difficulties of this task. In particular, a START agreement presents difficult verification challenges that go well beyond those we faced in INF. However, a START agreement has always been a high priority of mine and would constitute an historic achievement. If the Soviets show a similar commitment to reductions in strategic offensive arms and don't attempt to hold such reductions hostage to restrictions that would cripple SDI, we can conclude an effectively verifiable START agreement.
I firmly believe the achievements to date in U.S.-Soviet relations would not have been possible without the close consultations and unity of purpose between the United States and our allies, both in Europe and in Asia. Through this cooperation we have been able to send a clear message to Moscow that the Western alliance -- and when I use that term I have very much in mind our allies in Asia as well as NATO -- remains solid and committed to a realistic security policy vis-a-vis the Soviet Union. We have always valued highly the advice and support of your government as we have pursued our dialog with Moscow and will continue to do so in the future. Prime Minister Takeshita and I had a full exchange of views on the appropriate strategy for dealing with Mr. Gorbachev when we met in Washington.
U.S. Economic Policy
Q. In the field of world economy, the dollar exchange rate is coming down again, and stock markets have not quite stabilized yet. What would be your outlook for the world economy in 1988? What would you want Japan, West Germany, and other partners to do?
The President. In the coming year, as our trading sectors more fully adjust to the strong exchange rate signals of the last 2 years, we expect to see continued adjustments in real external imbalances, greater stability in exchange rates, a reduction in uncertainties facing traders, and an improved outlook for investment in our respective economies.
In the United States, we are reducing the budget deficit and the private sector is expanding exports. United States fiscal and monetary policies are encouraging real economic growth, a decline in the trade deficit, and a more stable dollar.
We would ask other countries to pursue the best interests of their consumers by breaking down the structural and policy barriers to imports that prevent them from enjoying a higher standard of living. Other nations also need to build up their domestic infrastructure and generally invest more in their own economies.
Q. What did you achieve through your talks with Prime Minister Takeshita of Japan during his first visit here as our Premier? What sort of personal relationship did you establish with him? May I take this opportunity to ask you your assessment of the U.S.-Japan relationship at present? How would you like to see it develop during 1988?
The President. Prime Minister Takeshita and I achieved a reaffirmation of the importance of U.S.-Japan relations not only to our two countries but to the world. We continued to demonstrate to the world the value of U.S.-Japan cooperation as allies and partners to global peace and prosperity.
I met with Prime Minister Takeshita when he was Minister of Finance, and since he became Prime Minister we have communicated on several occasions and exchanged personal messages. So, it is fair to say we had already established a personal relationship before our recent meeting. If I were to characterize that relationship, I would describe it as the sort of personal relationship one would expect between the leaders of two of the world's largest democracies and the two largest free economies, a relationship based on shared values and interests and mutual trust and respect.
United States-Japan relations are solid. There is hardly an important issue, multilateral or bilateral, on which we do not consult closely and cooperate. We have certain trade differences, but we are addressing them cooperatively, as friends and allies. We will continue to do so.
I expect that the United States and Japan will continue to consult and cooperate closely on a wide range of bilateral and global issues. Not only do we share values and interests, our economies are inextricably entwined, and neither country wants to see relations unravel. I can assure you we are working hard to make sure the bonds between us remain strong.
Q. Retaliatory measures hammered out by the Congress against Kansai Airport issue, as well as Toshiba and semiconductor sanctions, and demands for liberalization of import of rice and other agricultural products are proving to be highly sensitive in Japan, imbued with emotional undertones, making it difficult for Prime Minister Takeshita to implement necessary policy changes. Would there, after all, not be any possibility of compromise conceivable, such as a linkage of sorts between Japan's adoption of a decidedly domestic expansionist policy and lessening of these U.S. demands?
The President. Trade issues in both our countries are often highly sensitive. In dealing with these issues, we should seek solutions that are in the overall best interest of each nation and the international economy and not allow protectionist pressures to hold sway. Japan's expansionary economic policy is part of a coordinated effort to reduce external economic imbalances. This effort has been endorsed by the Group of Seven industrial nations. Increased domestic consumption and infrastructure investment are not an onerous burden for Japan and can help sustain world economic growth.
Q. What would you expect the outcome of the congressional discussions of the trade bill to be? Would you expect it to be less protectionist, in view of the recent economic developments?
The President. I would welcome a trade bill that is not protectionist. However, the current trade bill in Congress still contains a number of protectionist proposals. I will veto any bill that restricts trade, favors special interests to the detriment of the broader national interest, or includes procedural changes that are protectionist. I have urged Congress to jettison the protectionist features of the trade bill. They made little sense when originally proposed, and they make even less sense today. In my view, trade policy should not be confrontational but should help open markets, increase market incentives and efficiency, and make a positive contribution to world economic stability.
The impact of recent economic developments is difficult to predict. It is encouraging that monthly U.S. trade data have begun to show significant progress toward reducing the deficit. Of course, eliminating the deficit will take time. Because of that, protectionist sentiment will not go away quickly. There is also a deeply held view that U.S. markets are far more open to the exports of our trading partners than are their markets to United States exports. Our trading partners should understand and support the need of the United States to significantly increase exports if protectionism is to be contained.
How the U.S. Congress will react to economic developments is even more difficult to predict. I would hope that Congress will reconsider certain protectionist proposals that have passed one or both Houses. My opposition to such protectionist measures is as strong as ever.
Q. How would you evaluate the outcome of the recent Korean Presidential election? Are you optimistic about the Seoul Olympic games now? What would be your outlook for another emerging democracy in the Philippines? How would you feel about Prime Minister Takeshita visiting the Philippines before any other country? May I also ask you your outlook for East Asia in 1988?
The President. We were pleased that the Republic of Korea conducted its Presidential election and arrived at a democratic outcome. We look forward to working with Mr. Roh Tae Woo, the President-elect, and will keep open our channels to the opposition. Preparations for the Olympics are on track. I am pleased to see that East-bloc nations and the Soviet Union have accepted invitations. I know that the Republic of Korea remains open to compromise on the Olympics and hope that North Korea will join in this great celebration.
In the Philippines, President Aquino's government offers the best chance for establishing a stable democracy and a prosperous economy. President Aquino enjoys broad popular support, and Filipinos perceive her government as honest and committed to justice. There have been many accomplishments in the Philippines, including adoption of a new constitution, successful conduct of congressional elections, and restoration of economic growth. Prime Minister Takeshita's decision to attend the December ASEAN [Association of South East Asian Nations] ministerial conference in Manila, thereby visiting the Philippines before any other country, was an admirable demonstration of his government's support for the Aquino government and the ASEAN nations.
I am optimistic regarding prospects for the East Asian nations in 1988. I expect peaceful and stable relations within the region, though Vietnam's continuing occupation of Cambodia is unacceptable and should be ended without delay. We all hope for a relaxation of tensions on the Korean Peninsula and a successful Olympic games, developments that could contribute to better East-West relations. We must support the Aquino government's efforts to promote democracy, stability, and economic reform in the Philippines. We must remain resolute in maintaining our military preparedness against the steady Soviet buildup of forces deployed in East Asia. I foresee continuing economic growth and dynamism for the nations of East Asia in 1988. Given our mutual interest and desire to cooperate in trade and other matters, I see no reason why the East Asian nations cannot join with other nations, especially the United States and Japan, to achieve unprecedented prosperity for the betterment of all mankind.
Q. What would be your long-range outlook, well into the 21st century, of the U.S.-Japan relationship, in terms of the development of the Pacific rim area, as well as for the well-being of the world as a whole? At the same time, how would you see changes in the roles of China and the U.S.S.R. in the Pacific area as well as in the whole world of the 21st century?
The President. I am very optimistic -- and with good reason -- about the future of U.S.-Japan relations in the coming century. Already we are close allies. We maintain the largest overseas trading relationship in the history of the world, and our global interests coincide in most areas. The reason this remarkable relationship exists is no accident; rather, it stems from the fact that our two nations share a common set of democratic goals and principles and because we both believe in the virtues of an open economic system. I am confident that these shared principles and goals will continue to guide our two nations, and therefore I am equally confident that the excellent relations which now exist between the United States and Japan will continue to flourish in the coming century. In fact, the future of the Pacific rim area as a whole appears very bright in the next century. The principles of free trade and democracy are spreading throughout the world, even into once-dark corners of the Socialist world. America and Japan can work together to advance this trend.
Japan's International Role
Q. Are you satisfied with Japan's effort to build up her self-defense capabilities? And in view of the present level of our defense spending, are you satisfied with Japan's efforts to increase official development assistance and other aids to the Third World? What sort of contribution would you like to see from Japan to the protection of the shipping in the Persian Gulf?
The President. We consider it very important that Japan increase its capability to defend its homeland, territorial seas and skies, and sealanes out to 1,000 nautical miles -- goals incorporated in Japan's defense planning. We welcome, therefore, the increase in Japan's defense budget for the coming year, which will enable Japan to fund fully the third year of its current 5-year defense plan. We are also pleased that the budget provides additional funding to increase Japan's support for United States forces stationed in Japan.
We welcome efforts of the Government of Japan to increase aid flows and other financing for Third World countries. In particular, we applaud the plan to double official development assistance by 1990 and the commitment to recycle $20 billion over 3 years to developing countries.
We are pleased with measures undertaken by the Government of Japan to enhance navigational safety and promote peace in the Persian Gulf region. Provision of a navigational aid system, increased aid to Jordan and Oman, and funding for United Nations peace efforts are concrete signs of Japan's political commitment to Western solidarity in our common efforts to assure safe navigation and bring peace to the Gulf.
Note: The questions and answers were released by the Office of the Press Secretary on January 21.