Japan’s Economic Relations with the Common Market and West Germany

Abstract

The economic relations between Japan and the European Community (EC)—and therefore also with the Federal Republic of Germany (FRG)—have been characterized by latent tensions since the 70’s, which have manifested themselves in slashing verbal attacks, complaints and reproaches on the European side als well as appeasement efforts—not always meant seriously—with a number of so-called market opening programs and export-restriction agreements on the Japanese side. This conflict impended to escalate in more or less regular intervals. The statistical supervision of EC-imports from Japan in selective markets (passenger cars, colour televisions and television tubes, machine tools), introduced in 1982, the annoying import regulations for Japanese video recorders (clearance at the small custom-office of Portiers), imposed by France in the same year, als well as the limited introduction of anti-dumping tariffs on Japanese ball-bearing and copying machines in 1986 are just a few examples. (Compare the comprehensive description of the trade conflict between Japan and the EC till 1983 in Korte (1984) [7] and—concerning the especially brisant automobile sector—in Hamaeda (1982) [4] ). The conflict achieved a new critical point in 1987, when the EC Commission initiated anti-dumping procedures against several Japanese semi-conductor producers, who were able to increase their market share of so-called EPROMs from 60 to 78 % within two years, allegedly because of below-cost pricing. In addition, Brussels was seriously considering an anti-dumping measure with tariffs on products assembled from imported parts in European plants of Japanese companies. Not less alarming are the demands for import quotas on Japanese automobiles, presented to the EC Commission by big European (except German) car producers. They fear that up to 100.000 jobs in the European car and components industry could be lost within the next two years, unless the Japanese advance is halted.