a more free and stable fashion of national life. Yet, in order to augment her revenue to cover her narrow national income she is necessarily destined to increase further her export to the United States.

What alternative, if any, would there be for Japan to tide over this difficulty if her manufactures are forbidden by the United States because of low labor cost?

We, of course, are determined not to export hastily such items which, however gainful to us, are liable to bring about competition with the importing country. We ardently hope that Japan's stand in her foreign trade may be well understood by the United States au

thorities.

II. EFFECTS OF UNITED STATES TARIFF CONCESSIONS ON JAPANESE EXPORTS

(Ministry of International Trade and Industry)

The main export commodities on which the import tariffs have been reduced by the United States tariff concessions of 1955 are shown in the attached table. The exports of these commodities are in general on the increase. There are, however, other commodities which have not received the benefit of tariff reduction under these concessions, yet have recorded increased exports. Therefore, it is not clear how much the United States tariff concessions have contributed toward the increased exports of these commodities.

It is the general expectation that the exports from one country to another will increase as a result of tariff concessions by the latter. However, in the case of our exports to the United States, although it may be the case that the tariff concessions have had some bearing on the increase in the exports, the main factor for such an increase was rather the increased demand for Japanese commodities due to the improvement in the quality of the goods concerned and the growing demand for goods of Japanese taste and fashion in the United States.

On the other hand, there are some items which are difficult to export because the prices are still too high in spite of the tariff reductions, as, for instance, canned tuna on which the tariff has been reduced from 45 percent to 35 percent.

Therefore, it is desired that further tariff concessions will be forthcoming on a greater number of commodities.

Japanese export records of the main items on which the United States import tariffs have been reduced are as shown in the following table.

III. IMPORTS FROM THE UNITED STATES AND THEIR FUTURE PROSPECTS

(Ministry of International Trade and Industry)

Imports from the United States are shown in table A. In view of the tendency to expand the foreign exchange budgets as from the latter half of 1956, imports from the United States of the following items are expected to increase: lead in pigs, sulfite rayon pulp, scrap iron, phosphate rock, potash, crude oil, beans, beef tallow, and molybdenum ore.

Compiled by: Research Section, International Trade Bureau, Ministry of International Trade and Industry.

IV. EXPORT ADJUSTMENT MEASURES

(Ministry of International Trade and Industry)

As a matter of general principle, we have no desire nor intention of taking any measures to restrict our exports to the United States.

However, since the end of the war, certain Japanese exports to the United States have increased in volume remarkably; others, because of unnecessary competition between our own exporters, have tended to lower the export price; so, taking into consideration the fact that in the United States, the corresponding United States industries have, in a number of cases, resorted to appeals for increased tariff rates or import restrictions on such goods, the export commodities shown in the attached tables have been placed under voluntary export adjustment measures.

TABLE A.-List of Japanese export commodities to the United States under voluntary export adjustment measures