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.