China-Japan to meet again on trade


China and Japan agreed to settle their trade differences outside of the WTO, which China joined last month

By Alex Frew McMillan

HONG KONG, China -- China and Japan are set to resume talks on trade next month, according to Chinese state media.

The two countries, Asia's largest trading partners, narrowly averted intensifying a nine-month trade battle late last year.

Last-minute discussions on Friday December 21 helped them avoid a full-blown trade war. But the China-Japan truce didn't resolve the issues.

Both sides agreed to talks involving their public and private sectors to establish how to handle trade.

Private-sector talks

Japanese and Chinese officials will now gather again, with producers and importers. The official China Daily newspaper said Thursday that the follow-up meeting will happen in Shanghai on February 7 and 8.

Though officials will be present, the meeting is intended to be nongovernmental, a Chinese official at the Ministry of Foreign Trade and Economic Cooperation said.

Two Chinese chamber of commerce groups are heading the meetings, with Japan's trade ministry in charge of arranging private-sector Japanese participation.

Japan had been considering long-term four-year sanctions on leeks, shiitake mushrooms and tatami-mat rushes. It put temporary curbs on the goods, most of which come from China, last April.

But faced with a possible challenge to the World Trade Organization, Japan agreed in December not to impose long-term curbs.

Foreign minister fired

In return, China scrapped its punitive 100 percent tariffs on Japanese cars, air conditioners and cell phones. Those curbs were installed before China joined the WTO and likely would not have stood up.

China Daily reports the total value of Japanese imports of leeks, shiitake mushrooms and rushes are worth $150 million a year, including the goods from China.

Japanese shipments of cars, cell phones and air conditioners to China total about $1 billion, the newspaper states.

Though shipments of the goods involved are a fraction of the trade between the two countries, the dispute threatened to blossom.

Japan's then-foreign minister, Makiko Tanaka, had admitted that Japan was concerned about China's growing influence in Asia. The outspoken and popular Tanaka was fired by Prime Minister Junichiro Koizumi late on Tuesday night.

He said she was holding back reform.