EU report reshapes relations with Japan

The European Commission, the executive arm of the European Union, is preparing a new “communication” policy report on relations with Japan to replace one adopted by the 15 union nations nearly two years ago, Japanese government officials said Apr. 3.

The officials, who requested anonymity, said the report will serve as a basic guideline in the EU’s implementation of trade and other policies toward Japan for at least the next two years. A meeting of the EU foreign ministers this summer is expected to approve the report.

Though the commission informally notified Tokyo of its work, it did not divulge the contents except to say that the basic policy direction of the former communication remains unchanged, the officials said. The new communication appears likely to emphasize the need for more use of the World Trade Organization, a Geneva-based watchdog on international commerce that succeeded the General Agreement on Tariffs and Trade on Jan. 1, 1995, to resolve bilateral economic and trade disputes.

The EC informally notified Tokyo at the end of 1996 that it will take as many bilateral economic and trade disputes as possible to the WTO, rather than use patience and seek settlements in bilateral negotiations as was done in the past, according to one government official. “A senior commission official in charge of Japan policy told us at the end of last year that the commission will take all bilateral disputes to the WTO, if possible, in a businesslike manner from now on,” the official said.

Another government official said the commission’s greater use of WTO’s dispute-settlement steps may reflect an increasingly strong desire to boost overall EU exports to help stimulate the member economies and thereby create more jobs locally. The EU nations, which are struggling to meet budgetary and other requirements to join the single currency in 1999, cannot afford to take drastic fiscal measures, such as increased public spending, to stimulate their economies, the official observed.