Skip to main content
Find a Lawyer

U.S. Officials Press Japan to Continue Efforts Towards Deregulation and Bank Reform Following Japan-U.S. Agreement at G-8 Summit

This article was edited and reviewed by FindLaw Attorney Writers

| Last reviewed
Legally Reviewed

This article has been written and reviewed for legal accuracy, clarity, and style by FindLaw’s team of legal writers and attorneys and in accordance with our editorial standards.

Fact-Checked

The last updated date refers to the last time this article was reviewed by FindLaw or one of our contributing authors. We make every effort to keep our articles updated. For information regarding a specific legal issue affecting you, please contact an attorney in your area.

U.S. and Japanese negotiators on the fringes of the G-8 Summit in Birmingham, England, reached an agreement last month comprising several deregulatory initiatives. The main initiatives were in the areas of telecommunications, housing, medical devices/pharmaceuticals and financial services. Deputy USTR Fisher — the main U.S. negotiator at these talks — initially characterized this agreement as representing "billions and billions of dollars" for the U.S. industry.

In the days following this agreement, however, U.S. reaction returned to its usual "we will wait for results" attitude. In particular, USTR Barshefksy characterized the agreement as an "important step" that "now must be followed by further meaningful reform in these and other sectors." Fisher echoed Barshefsky's statement in commenting that the agreement is a "constructive" step, but that the United States would need to closely monitor progress toward implementing these initiatives.

In recent days, U.S. officials have also renewed their criticism of Japan's failure to address banking reform. Treasury Secretary Robert Rubin and Federal Reserve Chairman Alan Greenspan both have commented that forcing Japanese banks to deal with nonperforming loans is a necessary step toward getting Japan's economy growing again. In addition, U.S. Ambassador Thomas Foley commented in a speech last Friday entitled "A Post-Birmingham Look at U.S.-Japan Relations" that banking reform is a "critical element of improving Japan's economy."

We expect that U.S. criticism of Japan's failure to act on banking reform and also its failure to initiate a deeper tax cut will continue to be a focus of U.S. official statements towards Japan. Such criticism is likely to intensify as reports of Japan's trade deficit continue month after month, and comments are heard more often that the impact of this trade deficit may soon produce a pronounced effect on the U.S. economy.

Was this helpful?

Copied to clipboard