U.S. Takes Tough Trade Stance : Imbalance: Tokyo gets a stern warning that it must reduce its surplus if it wants to keep free access to American markets.

WASHINGTON —  The Clinton Administration, concerned about America’s “increasingly corrosive” economic relationship with Japan, warned bluntly Monday that Tokyo must substantially reduce its global trade surplus if it wants to maintain free access to U.S. markets.

Outlining the approach the Administration will take Friday when it opens talks intended to establish a new framework for the crucial U.S.-Japanese trade relationship, the officials declined to characterize their warning as an outright threat.

Rather, they said political pressures would force them to begin limiting Japanese imports if the imbalance--nearly $50 billion with the United States, and $132 billion worldwide in 1992--continues unabated.

The approach, which officials said President Clinton approved last week, represents a dramatic change in U.S. relations with Japan and could signal the start of a new era of “managed trade.”

For more than four decades, Washington placed its security relationship with Japan above other considerations, looking the other way when Japan followed economic practices that threatened U.S. interests. But with the disappearance of the Soviet threat--and with it Japan’s value as a strategic Pacific ally--economic matters are becoming preeminent.

Thus, the new Administration, many of whose members came of age in a period of growing Japanese economic power, appears inclined to pursue a more adversarial course, seeing Japan not as a crucial political ally or, in the words of California Rep. Robert T. Matsui (D-Sacramento), as “a little brother we had to nurture,” but as a serious economic competitor.

At the same time, although the Administration has said that its goal is to operate under a guiding philosophy of “free trade” unencumbered by tariffs, quotas or other obstacles, it is departing significantly from past policies.

“We had 12 years of administrations that had a real philosophical commitment to free trade as a solution to our economic problems,” said Sen. Jeff Bingaman (D-N.M.). “This Administration has that commitment, but (it has) a real view of the benefits and disadvantages of us pursuing free trade when others are not.”

“The essence for the new economic framework is a bargain,” said one senior official, speaking on the condition that his name not be used.

The “bargain,” he said, would work like this: Japan brings down its trade surplus, taking steps to increase “import penetration” by other nations, including the United States, “by a substantial amount” in five specific areas of its economy. In exchange, the United States “would agree to keep our markets as open to Japanese goods,” and products of other nations, “as they have traditionally been.”

“We think these goals are realistic,” he said. “Looking forward over a three- or four-year period, we think they are symmetrical, in terms of balance, and we think they are in both country’s interests.”

At the heart of the Administration’s approach will be an effort to set “numerical indicators,” or targets, in each of five trading areas. But, said another senior official, although specific goals for Japanese purchases of U.S. goods would be set, there will be no “automatic retaliation” if they are not met.

“The focus is on market access, not closing the U.S. market,” another official said.

Matsui, a member of the House Ways and Means Committee’s subcommittee on trade, said that Japan’s trade surplus requires that it be treated uniquely.

“The key is to keep their feet to the fire and have goals on a sector-by-sector basis,” he said. “That’s the only way we’ll be able to penetrate the Japanese market.”

Japan, anticipating the U.S. approach, has begun a campaign among other major trading nations of Asia to resist U.S. pressure. Clinton Administration officials, seeking to allay others’ concerns, have stressed that they want to open up the Japanese market for all nations, not just the United States.

“It is corrosive of the multilateral trading system if we are seen as trying to get a unilateral edge in Japan by trying to get them to agree in advance about how much they will buy from us,” said Stephen Bosworth, of the U.S.-Japan Foundation.