Remarks on the Japan-United States Trade Agreement

Thank you very much, Wolf [Wolf Blitzer, CNN], for that introduction. [Laughter]

Ladies and gentlemen, for 2 1/2 years, I have worked hard to open markets and expand trade around the world for one simple reason: It is good for America. When we open new markets, millions of new consumers buy American products. And when we sell more American products, we create more American jobs. We created the largest market in the world with NAFTA. We passed GATT, the most comprehensive trade agreement ever.

The plain truth is, our products are now the best in the world, high quality, low cost. And our job here, and my job as President, is to make sure they can be sold fairly and freely throughout the world. That's how we create prosperity here at home.

One of the largest obstacles to free and fair trade has been the artificial barriers erected by Japan, especially around its auto and auto parts markets. For over 20 years, Presidents have tried to fix this problem without success. This unfair situation had to end.

After 20 months of negotiations, I ordered my Trade Representative, Ambassador Kantor, to impose sanctions on Japan unless they agreed to open these markets. Today Japan has agreed that it will begin to truly open its auto and auto parts markets to American companies.

This agreement is specific. It is measurable. It will achieve real, concrete results. And I have insisted on it from the start. In 1993, the Japanese and I agreed at our meeting in Japan on specific negotiating goals in the framework agreement. We have now achieved those goals. Now, through 2 years of steady and determined negotiations, we have done what we set out to do 2 1/2 years ago.

Trade must be a two-way street. After 20 years, we finally have an agreement that will move cars and parts both ways between the United States and Japan. This breakthrough is a major step toward free trade throughout the world.

Japan will take specific steps that we expect will increase the number of dealers selling non-Japanese cars by 200 next year and 1,000 over the next 5 years. In the United States, 80 percent of our car dealers sell foreign cars right next to American cars. But in Japan, only 7 percent of car dealers sell American cars or any non-Japanese cars. That is unfair, and this agreement makes a strong start in fixing it.

Japan will begin to undo the rigid regulations of its market for repair parts. This agreement breaks the stranglehold Japanese manufacturers have had over repair shops and garages. It means more U.S. parts will be sold in Japan.

Finally, Japanese carmakers will expand their production in the United States and buy more American parts both here and in Japan. These measurable plans should increase purchases of American car parts by almost $9 billion in 3 years, a 50 percent increase. Japan is going to make half a million more new cars in the United States by 1998, an increase of 25 percent.

Sixty percent of our entire trade deficit with Japan is the result of a car and car parts deficit. This agreement helps to close the gap. This commitment means thousands of new jobs for American workers, jobs for Americans making parts sold to Japan, jobs for Americans making parts for Japanese cars manufactured here, jobs for Americans making American cars now sold in Japan, and jobs for Americans making Japanese models made in the United States, which will increase substantially in number over the next few years. It is therefore a victory for our hardworking families. But make no mistake, it is also a victory for Japanese consumers, because it will mean lower prices for good products for them.

I want to commend the leaders of Japanese auto parts companies and auto companies and the leaders of the Japan Government for the courage and vision it took for them to reach this agreement. I personally want to thank Prime Minister Murayama and Minister Hashimoto for their leadership. And I especially want to thank Ambassador Mickey Kantor and his extraordinary team for the exhaustive efforts they have made to reach this successful conclusion.

In just a few moments, as soon as I conclude here, Ambassador Kantor and Minister Hashimoto will have a statement in detail about this agreement and will answer questions about it. I'm sure you can understand that they are in a better position to answer detailed questions than I am.

I had a long conversation with Ambassador Kantor about an hour ago, and I congratulated him.

I want all of you to understand that there is still much to be done. This agreement will not solve every problem in our relationship. But for today we have proved that hard bargaining and good faith can overcome apparently insurmountable conflict. This is important. And what it means is that sanctions are not necessary because we have achieved our goals. I am very proud of this negotiating team. I want to say that again. We set out a strategy, we held firm to our principles, and we achieved our goals. And those goals will lead to more jobs for Americans. Discipline at the negotiating table once again has proved that we can be successful.

And I want to say finally, again, this is a great victory for the American people. It is also a victory for the Japanese people. We both won. And as a result, the global economy and American jobs are better off.

Thank you.

Q. Is this a voluntary agreement, or are there any guarantees, Mr. President?

The President. Mr. Kantor will be speaking in just a moment, and he'll answer all the questions.