October 6, 2017 / 2:37 AM / 2 years ago

Japan, U.S. to hold second round of economic dialogue on October 16

TOKYO (Reuters) - Japanese Finance Minister Taro Aso said on Friday he would meet U.S. Vice President Mike Pence in Washington D.C. on Oct. 16 for the second round of an economic dialogue between the two countries.

FILE PHOTO: Taro Aso, Minister of Finance and Minister of State for Financial Services of Japan, speaks during the Milken Institute Global Conference in Beverly Hills, California, U.S., May 1, 2017. REUTERS/Lucy Nicholson/File Photo

When asked about the possibility that the talks would include trade negotiations, Aso said it is better to improve the way it manages its existing quota system for imports of frozen U.S. beef instead of changing laws to create new rules.

The dialogue is shaping up to be a test of whether the close U.S.-Japan economic relationship can withstand U.S. President Donald Trump’s pledge to create more jobs and lower the U.S. trade deficit.

“Of course, I want to protect Japan’s national interests,” Aso said. “I also want to have a win-win relationship with the United States on matters of economic policy.”

Japan hiked tariffs from Aug. 1 on imports of frozen beef, popular in beef bowl dishes, from countries including the United States to 50 percent from 38.5 percent. The measure follows Trump’s withdraw from the long-planned Trans-Pacific Partnership (TPP) trade deal earlier this year.

The tariff hike, set to be in place until next March, is a “safeguard” mechanism to protect domestic farmers but has prompted some concern in Washington.

Under current measures, Japan automatically imposes higher tariffs if quarterly imports of specific beef products from any country rise more than 17 percent from the previous year.

One way to improve this safeguard is to monitor beef imports for shorter durations, such as every 10 days, to make sure its trading partners do not breach its quota, Aso said on Friday.

The first round of the U.S.-Japan economic dialogue, which was held in Tokyo in April, ended largely without incident. However, there is some concern among Japanese officials that the U.S. side could strongly push for trade concession during the second dialogue meeting.

Japan had a $69-billion trade surplus with the United States last year, according to the U.S. Treasury Department, which has expressed concern over what it called the “persistence” of the imbalance.

Japanese officials counter that Tokyo accounts for a much smaller slice of the U.S. deficit than in the past, while China’s imbalance is much bigger.

Reporting by Stanley White; Editing by Chris Gallagher

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