Japan's Aso Cancels U.S. Econ Talks Visit Due N. Korea Threat

     TOKYO (MNI) - Japanese Deputy Prime Minister Taro Aso has canceled his

planned visit to Washington next week, postponing a preparatory meeting for the

second round of the bilateral economic dialogue to cope with the escalating

threat of missile attacks by North Korea.

     Aso, who is also finance minister, had planned to compare notes on trade

issues with U.S. Vice President Mike Pence at the White House during his visit

starting on Monday, press reports said.

     But Prime Minister Shinzo Abe told Aso to stay in Japan to be able to

respond to any developments in Pyongyang's nuclear weapon and ballistic missile

program while the prime minister is in Vladivostok to meet Russian President

Vladimir Putin, Aso told reporters Friday.

     Aso said the second round of U.S.-Japan economic talks was likely to be

held by the end of the year, sometime after the annual meeting of the

International Monetary Fund and the World Bank in Washington in October,

according to a MOF spokesman.

     At the first meeting of the U.S.-Japan Economic Dialogue in Tokyo in April,

Aso and Pence, as the co-chairs, agreed on three policy pillars: a common

strategy on trade and investment rules and issues; cooperation in economic and

structural policies; and cooperation in certain commercial and industrial

sectors.

     At a joint news conference in April, Pence reiterated that Washington

wanted to seek a bilateral free-trade deal with Tokyo while Aso stressed that

the two economic and military allies had embarked on a new era of cooperation in

trade and investment.

     Japanese officials are wary of opening bilateral trade talks, though,

because they expect the U.S. would demand that Japan open up its agricultural

markets more drastically to imports.

     Aso has said in parliamentary hearings that President Donald Trump, who has

blamed Japan's trade policy for hurting U.S. growth, needed to update his memory

of bilateral trade ties, which he said was stuck in the 1980s. Since then, he

says, Japanese manufacturers have set up many factories in the U.S. and hired

thousands of local workers, particularly in the automotive sector.

     Under the second pillar of cooperation in economic and structural policies,

Aso said the U.S. and Japan would pursue a "three-pronged approach" of mutually

reinforcing fiscal, monetary and structural policies set by the Group of Seven

industrialized nations. They will also coordinate on global economic and

financial developments, he said.

--MNI Tokyo Bureau; tel: +81 90-4670-5309; email: max.sato@marketnews.com

--MNI BEIJING Bureau; +1 202-371-2121; email: john.carter@mni-news.com

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