TRADE: Tough Talks With Tokyo

Several simmering economic disputes between the U.S. and Japan came to a boil last week. In one case, the White House had threatened to impose trade sanctions against Japan if it did nothing to open up its construction business to American companies by March 30. Before the deadline arrived, though, Tokyo agreed to give U.S. companies the same chance as their Japanese competitors to bid on 14 public works projects, valued at $17 billion. But the Japanese government did not guarantee American firms any share of the construction work.

Meanwhile, Congress was moving closer to slapping sanctions on Toshiba, the Japanese electronics giant, because it illegally sold the Soviets high-tech equipment used to make submarine propellers. A congressional committee working on a huge trade bill reportedly agreed to ban for three years the importation of machine tools and other products made by Toshiba Machine, the subsidiary that made the illicit sale. Though Toshiba's familiar consumer products would still be available, the provision would bar U.S. Government agencies from buying any Toshiba product for as long as three years. Still, the White House might veto a trade bill containing such sanctions.

Another contentious issue involves agriculture. An agreement governing Japanese imports of American beef and citrus products expired, and negotiators from the two countries were deadlocked. The U.S. wants Japan to remove its quotas on beef and citrus imports. With U.S. sirloin costing as much as $20 per lb. in Tokyo, Japan was willing to liberalize quotas but refused to eliminate them. Since the ruling Liberal Democratic Party depends so heavily on farmers' support, the government has not been able to take such a politically risky step.