• Kyodo

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Japan and the United States expect to agree on forming a new trade panel to deal with bilateral issues when Prime Minister Junichiro Koizumi and President George W. Bush hold their summit June 30, Japanese and U.S. government sources said Sunday.

The panel will discuss closer economic ties, including the option of Japan and the U.S. forming a free trade agreement, Japanese sources said.

But the sources also said an FTA will be considered only as a medium to longer-term possibility, noting that existence of less competitive sectors in the two countries, such as Japan’s farm industry and U.S. steelmakers, makes it politically difficult for Japanese and U.S. leaders to immediately agree on an FTA.

Wendy Cutler, assistant U.S. trade representative for Japan, and Lawrence Greenwood, U.S. coordinator for the Asia-Pacific Economic Cooperation forum, will visit Tokyo this week for talks with Japanese officials on finalizing the proposed bilateral panel, which will deal with such issues as autos, auto parts, steel and agriculture, the sources said.

The new trade panel, tentatively called the trade commission, would hold its first meeting this fall, they said.

The U.S. officials will also discuss proposals that include forming a vice-ministerial economic forum, and three other forums to tackle deregulation, investment promotion and macroeconomics, they said.

At Japan’s request, the officials will also negotiate a bilateral round table forum involving businesspeople, they said.

South Korea talks

Japan and South Korea will hold high-level economic talks Tuesday in Seoul, covering negotiations aimed at concluding an investment pact and consideration of a free trade agreement, Foreign Ministry officials said Monday.

During the one-day gathering, the two sides will also trade views on bilateral cooperation in international areas such as macroeconomics and the pending launch of a new round of multilateral trade talks under the World Trade Organization, the officials said.

It will be the third such talks since the two countries decided in October 1998 on a plan of action to promote further cooperation in various fields.

Deputy Foreign Minister Yoshiji Nogami will lead the Japanese delegation, which is to be made up of representatives from the Cabinet Office; the Public Management, Home Affairs, Posts and Telecommunications Ministry; the Agriculture, Forestry and Fisheries Ministry; and the Economy, Trade and Industry Ministry.

The South Korean team will be headed by Deputy Trade Minister Choi Hyuck and other members of the Foreign Affairs and Trade Ministry as well as officials from the Agriculture and Forestry Ministry; the Commerce, Industry and Energy Ministry; and the Finance and Economy Ministry.

In September, then Prime Minister Yoshiro Mori and South Korean President Kim Dae Jung agreed to accelerate working-level talks on concluding an investment pact and to set up a new forum of experts to discuss the possibilities for a bilateral FTA.

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