U.S. Department of State, July 2000
Bureau of East Asian and Pacific Affairs

Background Notes: Japan

Official Name: Japan

PROFILE

Geography

Area: 377,765 sq. km. (145,856 sq. mi.); slightly smaller
than California.
Cities: Capital--Tokyo. Other cities--Yokohama, Osaka,
Nagoya, Sapporo, Kobe, Kyoto, Fukuoka.
Terrain: Rugged, mountainous islands.
Climate: Varies from subtropical to temperate.

People

Nationality: Noun and adjective--Japanese.
Population (1998): 126.2 million.
Population growth rate (1997): 0.23%.
Ethnic groups: Japanese; Korean (0.6%).
Religions: Shinto and Buddhist; Christian (about 1%).
Language: Japanese.
Education: Literacy--99%.
Health (1997): Infant mortality rate--4/1,000. Life
expectancy--males 77 yrs., females 83 yrs.
Work force (67 million, 1997): Services--23%; trade,
manufacturing, mining, and construction--56%; agriculture,
forestry, fisheries--6%; government--3%.

Government

Type: Constitutional monarchy with a parliamentary government.
Constitution: May 3, 1947.
Branches: Executive--prime minister (head of government).
Legislative--bicameral Diet (House of Representatives and
House of Councillors).
Judicial--civil law system based on the model of Roman law.
Administrative subdivisions: 47 prefectures.
Political parties: Liberal Democratic Party (LDP),
Democratic Party of Japan (DPJ), Komeito, Liberal Party,
Conservative Party, Japan Communist Party (JCP), Social
Democratic Party (SDP).
Suffrage: Universal at 20.

Economy

GDP (1998): $3.797 trillion.
Real growth rate (1998): -2.8%.
Per capita GDP (1998): $30,100.
Natural resources: Negligible mineral resources, fish.
Agriculture: Products--rice, vegetables, fruits, milk, meat,
silk.
Industry: Types--machinery and equipment, metals and metal
products, textiles, autos, chemicals, electrical and
electronic equipment. Japan's industrialized, free market
economy is the second-largest in the world. Its economy is
highly efficient and competitive in areas linked to
international trade, but productivity is far lower in areas
such as agriculture, distribution, and services. After
achieving one of the highest economic growth rates in the
world from the 1960s through the 1980s, the Japanese economy
slowed dramatically in the early 1990s, when the "bubble
economy" collapsed. For 2000, the economy is projected to
grow at a rate of 0.9% (IMF fig.).

PEOPLE

Japan is one of the most densely populated nations in the
world, with some 330 persons per square kilometer (almost
860 persons per sq. mi.). For 1997, the population growth
rate was about 0.23%. Japan's low population growth rate in
recent years has raised concerns about the social
implications of an aging population.

The Japanese are a Mongoloid people, closely related to the
major groups of East Asia. However, some evidence also
exists of a mixture with Malayan and Caucasoid strains.
About 750,000 Koreans and much smaller groups of Chinese and
Caucasians reside in Japan.

Buddhism is important in Japan's religious life and has
strongly influenced fine arts, social institutions, and
philosophy. Most Japanese consider themselves members of one
of the major Buddhist sects.

Shintoism is an indigenous religion founded on myths,
legends, and ritual practices of the early Japanese. Neither
Buddhism nor Shintoism is an exclusive religion. Most
Japanese observe both Buddhist and Shinto rituals: the
former for funerals and the latter for births, marriages,
and other occasions. Confucianism, primarily an ethical
system, profoundly influences Japanese thought as well.
About 1.3 million people in Japan are Christians, of whom
60% are Protestant and 40% Roman Catholic.

Japan provides free public schooling for all children
through junior high school. Ninety-four percent of students
go on to 3-year senior high schools, and competition is
stiff for entry into the best universities. Japan enjoys one
of the world's highest literacy rates (99%), and nearly 90%
of Japanese students complete high school.

HISTORY

Traditional Japanese legend maintains that Japan was founded
in 600 BC by the Emperor Jimmu, a direct descendant of the
sun goddess and ancestor of the present ruling imperial
family. About AD 405, the Japanese court officially adopted
the Chinese writing system. During the sixth century,
Buddhism was introduced. These two events revolutionized
Japanese culture and marked the beginning of a long period
of Chinese cultural influence. From the establishment of the
first fixed capital at Nara in 710 until 1867, the emperors
of the Yamato dynasty were the nominal rulers, but actual
power was usually held by powerful court nobles, regents, or
"shoguns" (military governors).

Contact With the West

The first contact with the West occurred about 1542, when a
Portuguese ship, blown off its course to China, landed in
Japan. During the next century, traders from Portugal, the
Netherlands, England, and Spain arrived, as did Jesuit,
Dominican, and Franciscan missionaries. During the early
part of the 17th century, Japan's shogunate suspected that
the traders and missionaries were actually forerunners of a
military conquest by European powers. This caused the
shogunate to place foreigners under progressively tighter
restrictions. Ultimately, Japan forced all foreigners to
leave and barred all relations with the outside world except
for severely restricted commercial contacts with Dutch and
Chinese merchants at Nagasaki. This isolation lasted for 200
years, until Commodore Matthew Perry of the U.S. Navy forced
the opening of Japan to the West with the Convention of
Kanagawa in 1854.

Within several years, renewed contact with the West
profoundly altered Japanese society. The shogunate was
forced to resign, and the emperor was restored to power. The
"Meiji restoration" of 1868 initiated many reforms. The
feudal system was abolished, and numerous Western
institutions were adopted, including a Western legal system
and constitutional government along quasi-parliamentary
lines.

In 1898, the last of the "unequal treaties" with Western
powers was removed, signaling Japan's new status among the
nations of the world. In a few decades, by creating modern
social, educational, economic, military, and industrial
systems, the Emperor Meiji's "controlled revolution" had
transformed a feudal and isolated state into a world power.

Wars With China and Russia

Japanese leaders of the late 19th century regarded the
Korean Peninsula as a "dagger pointed at the heart of
Japan." It was over Korea that Japan became involved in war
with the Chinese Empire in 1894-95 and with Russia in
1904-05. The war with China established Japan's dominant
interest in Korea, while giving it the Pescadores Islands
and Formosa (now Taiwan). After Japan defeated Russia in
1905, the resulting Treaty of Portsmouth awarded Japan
certain rights in Manchuria and in southern Sakhalin, which
Russia had received in 1875 in exchange for the Kurile
Islands. Both wars gave Japan a free hand in Korea, which it
formally annexed in 1910.

World War I to 1952

World War I permitted Japan, which fought on the side of the
victorious Allies, to expand its influence in Asia and its
territorial holdings in the Pacific. The postwar era brought
Japan unprecedented prosperity. Japan went to the peace
conference at Versailles in 1919 as one of the great
military and industrial powers of the world and received
official recognition as one of the "Big Five" of the new
international order. It joined the League of Nations and
received a mandate over Pacific islands north of the Equator
formerly held by Germany. During the 1920s, Japan progressed
toward a democratic system of government. However,
parliamentary government was not rooted deeply enough to
withstand the economic and political pressures of the 1930s,
during which military leaders became increasingly
influential.

Japan invaded Manchuria in 1931 and set up the puppet state
of Manchukuo. In 1933, Japan resigned from the League of
Nations. The Japanese invasion of China in 1937 followed
Japan's signing of the "anti-Comintern pact" with Nazi
Germany the previous year and was part of a chain of
developments culminating in the Japanese attack on the
United States at Pearl Harbor, Hawaii on December 7, 1941.

After almost 4 years of war, resulting in the loss of 3
million Japanese lives and the atomic bombings of Hiroshima
and Nagasaki, Japan signed an instrument of surrender on the
U.S.S. Missouri in Tokyo Harbor on September 2, 1945. As a
result of World War II, Japan lost all of its overseas
possessions and retained only the home islands. Manchukuo
was dissolved, and Manchuria was returned to China; Japan
renounced all claims to Formosa; Korea was granted
independence; southern Sakhalin and the Kuriles were
occupied by the U.S.S.R.; and the United States became the
sole administering authority of the Ryukyu, Bonin, and
Volcano Islands. The 1972 reversion of Okinawa completed the
United States' return of control of these islands to Japan.

After the war, Japan was placed under international control
of the Allies through the Supreme Commander, Gen. Douglas
MacArthur. U.S. objectives were to ensure that Japan would
become a peaceful nation and to establish democratic
self-government supported by the freely expressed will of
the people. Political, economic, and social reforms were
introduced, such as a freely elected Japanese Diet
(legislature). The country's constitution took effect on May
3, 1947. The United States and 45 other Allied nations
signed the Treaty of Peace with Japan in September 1951. The
U.S. Senate ratified the treaty in March 1952, and under the
terms of the treaty, Japan regained full sovereignty on
April 28, 1952.

Recent Political Developments

The post-World War II years saw tremendous economic growth
in Japan, with the political system dominated by the Liberal
Democratic Party (LDP). That total domination lasted until
the Diet Lower House elections on July 18, 1993 in which the
LDP, in power since the mid-1950s, failed to win a majority
and saw the end of its four-decade rule. A coalition of new
parties and existing opposition parties formed a governing
majority and elected a new prime minister, Morihiro
Hosokawa, in August 1993. His government's major legislative
objective was political reform, consisting of a package of
new political financing restrictions and major changes in
the electoral system. The coalition succeeded in passing
landmark political reform legislation in January 1994.

Under the 1994 legislation, the Lower House electoral system
was changed to one in which 300 members are elected in
single-member districts and another 200 members on
proportional slates in 11 regions. The new electoral system
also reduced the number of seats in overly represented rural
areas and shifted them to some urban areas. The overall
number of seats was reduced to 480 total as of the June 2000
elections.

In April 1994, Prime Minister Hosokawa resigned. Prime
Minister Tsutomu Hata formed the successor coalition
government, Japan's first minority government in almost 40
years. Prime Minister Hata resigned less than 2 months
later. Prime Minister Tomiichi Murayama formed the next
government in June 1994, a coalition of his Japan Socialist
Party (JSP), the LDP, and the small Sakigake Party. The
advent of a coalition containing the JSP and LDP shocked
many observers because of their previously fierce rivalry.
Prime Minister Murayama served from June 1994 to January
1996. He was succeeded by Prime Minister Ryutaro Hashimoto,
who served from January 1996 to July 1998. Prime Minister
Hashimoto headed a loose coalition of three parties until
the July 1998 Upper House election, when the two smaller
parties cut ties with the LDP. Hashimoto resigned due to a
poor electoral showing by the LDP in those Upper House
elections. He was succeeded as party president of the LDP
and prime minister by Keizo Obuchi, who took office on July
30, 1998.

The LDP formed a governing coalition with the Liberal Party
in January 1999, and Keizo Obuchi remained prime minister.
The LDP-Liberal coalition expanded to include the Komeito
Party in October 1999. Prime Minister Obuchi suffered a
stroke in April 2000 and was replaced by Yoshiro Mori, who
retained all of his predecessor's cabinet members. After the
Liberal Party left the coalition in April 2000, Prime
Minister Mori welcomed a Liberal Party splinter group, the
Conservative Party, into the ruling coalition. In June 2000
Lower House elections, Prime Minister Mori's three-party
coalition of the LDP, Komeito, and the Conservative Party
maintained its majority in the Diet.

GOVERNMENT AND POLITICAL CONDITIONS

Japan is a constitutional monarchy with a parliamentary
government. There is universal adult suffrage with a secret
ballot for all elective offices. The executive branch is
responsible to the Diet, and the judicial branch is
independent. Sovereignty, previously embodied in the
emperor, is vested in the Japanese people, and the emperor
is defined as the symbol of the state. Japan's Government is
a parliamentary democracy, with a House of Representatives
and a House of Councillors. Executive power is vested in a
cabinet composed of a prime minister and ministers of state,
all of whom must be civilians. The prime minister must be a
member of the Diet and is designated by his colleagues. The
prime minister has the power to appoint and remove
ministers, a majority of whom must be Diet members.

Japan's judicial system, drawn from customary law, civil
law, and Anglo-American common law, consists of several
levels of courts, with the Supreme Court as the final
judicial authority. The Japanese constitution includes a
bill of rights similar to the U.S. Bill of Rights, and the
Supreme Court has the right of judicial review. Japanese
courts do not use a jury system, and there are no
administrative courts or claims courts. Because of the
judicial system's basis, court decisions are made in
accordance with legal statutes. Only Supreme Court decisions
have any direct effect on later interpretation of the law.

Japan does not have a federal system, and its 47 prefectures
are not sovereign entities in the sense that U.S. States
are. Most depend on the central government for subsidies.
Governors of prefectures, mayors of municipalities, and
prefectural and municipal assembly members are popularly
elected to 4-year terms.

Principal Government Officials

Prime Minister--Yoshiro Mori
Minister of Foreign Affairs--Yohei Kono
Minister of Finance--Kiichi Miyazawa
Ambassador to the U.S.--Shunji Yanai
Ambassador to the UN--Yukio Sato

Japan maintains an embassy in the United States at 2520
Massachusetts Avenue NW, Washington, DC (tel. 202-238-6700).
Consulates General are in Anchorage, Atlanta, Boston,
Chicago, Detroit, Guam, Honolulu, Houston, Kansas City, Los
Angeles, New Orleans, New York City, Portland, San
Francisco, and Seattle. Honorary consulates general are in
Buffalo, Cleveland, Dallas, Denver, Nashville, Miami,
Minneapolis, Mobile, Phoenix, St. Louis, San Diego, and San
Juan; and an honorary consulate is in American Samoa. The
Japan National Tourist Organization is at 630 Fifth Avenue,
New York, NY, 10111.

ECONOMY

Japan is the second-largest economy in the world after the
United States. Its reservoir of industrial leadership and
technicians, well-educated and industrious work force, high
savings and investment rates, and intensive promotion of
industrial development and foreign trade have produced a
mature industrial economy. Along with North America and
western Europe, Japan is one of the three major industrial
complexes among the market economies. Japan has few natural
resources, and trade helps it earn the foreign exchange
needed to purchase raw materials for its economy. In 1997,
the country's exports amounted to about 12% of its GDP.

While Japan's long-term economic prospects are considered
good, Japan is currently in its worst recession since World
War II. Plummeting stock and real estate prices marked the
end of the "bubble economy" of the late 1980s. The impact of
the Asian financial crisis also has been substantial. Real
GDP in Japan grew at an average of roughly 1.25% yearly
between 1991-98, compared to growth in the 1980s of about 4%
per year. Growth in Japan in this decade has been slower
than growth in other major industrial nations. The
Government of Japan has forecast growth in Japan fiscal year
1999 at 0.5%. A number of economic indicators remain in
negative territory, but Japan announced strong growth (1.9%)
for first quarter 1999.

Agriculture, Energy, and Minerals

Only 15% of Japan's land is suitable for cultivation. The
agricultural economy is highly subsidized and protected.
With per hectare crop yields among the highest in the world,
Japan maintains an overall agricultural self-sufficiency
rate of about 50% on fewer than 5.6 million cultivated
hectares (14 million acres). Japan normally produces a
slight surplus of rice but imports large quantities of
wheat, sorghum, and soybeans, primarily from the United
States. As part of the General Agreement on Tariffs and
Trade (GATT) Uruguay Round, Japan agreed to open its
agricultural markets further, including partial
liberalization of the rice market.

Given its heavy dependence on imported energy, Japan has
aimed to diversify its sources. Since the oil shocks of the
1970s, Japan has reduced dependence on petroleum as a source
of energy from more than 75% in 1973 to about 57% at
present. Other important energy sources are coal, liquefied
natural gas, nuclear power, and hydropower.

Deposits of gold, magnesium, and silver meet current
industrial demands, but Japan is dependent on foreign
sources for many of the minerals essential to modern
industry. Iron ore, coke, copper, and bauxite must be
imported, as must many forest products.

Transportation

Japan has a well-developed international and domestic
transportation system, although highway development still
lags. Tokyo and Osaka International Airports and the ports
of Yokohama, Osaka, Kobe, and Nagoya are important terminals
for air and sea traffic in the western Pacific. However,
greatly increased traffic in the Pacific markets is putting
a severe strain on Japan's airports.

The domestic transportation system depends on a recently
privatized rail network. National rail transportation is
supplemented by private railways in metropolitan areas, a
developing highway system, coastal shipping, and several
airlines. The rail system is efficient and well-distributed
and is maintained throughout the country. The super express
"bullet trains" take as little as 3 hours between Tokyo and
Osaka, a distance of 520 kilometers (325 mi.).

Labor

Japan's labor force consists of some 67 million workers, 40%
of whom are women. Labor union membership is about 12
million. The unemployment rate is currently at a record high
4.9%. In 1989, the predominantly public sector union
confederation, SOHYO (General Council of Trade Unions of
Japan), merged with RENGO (Japanese Private Sector Trade
Union Confederation) to form the Japanese Trade Union
Confederation, also called RENGO, which has more than 7
million members.

FOREIGN RELATIONS

Despite its current slow economic growth, Japan remains a
major economic power both in the region and globally. Japan
has diplomatic relations with nearly all independent nations
and has been an active member of the United Nations since
1956. Japanese foreign policy has aimed to promote peace and
prosperity for the Japanese people by working closely with
the West and supporting the United Nations.

After World War II, the Allies disarmed and occupied Japan.
Article IX of the Japanese constitution provides that "land,
sea, and air forces, as well as other war potential, will
never be maintained." During the 1950-53 Korean war, a
national police reserve force was established. Before the
end of the U.S. occupation of Japan in 1952, the first steps
had been taken to expand and transform the force into the
Self-Defense Force (SDF). At the same time, the Japanese
Government accepted Article 51 of the UN Charter that each
nation has the right of self-defense against armed attack.
This doctrine was consistent with Article IX of the Japanese
constitution.

In 1954, the Japan Defense Agency was created with the
specific mission of defending Japan against external
aggression. Ground, maritime, and air self-defense forces
were established.

In recent years, the Japanese public has shown a
substantially greater awareness of security issues and
increasing support for the SDF. This is in part due to its
success in disaster relief efforts at home and its
participation in peacekeeping operations in Cambodia in the
early 1990s. However, there are still significant political
and psychological constraints on strengthening Japan's
defense.

Although a military role for Japan in international affairs
is precluded by its constitution and government policy,
Japanese cooperation with the United States through the 1960
U.S.-Japan security treaty has been important to the peace
and stability of East Asia. All postwar Japanese governments
have relied on a close relationship with the United States
as the foundation of their foreign policy and have depended
on the mutual security treaty for strategic protection.

While maintaining its relationship with the United States,
Japan has diversified and expanded its ties with other
nations. Good relations with its neighbors continue to be of
vital interest. After the signing of a peace and friendship
treaty with China in 1978, ties between the two countries
developed rapidly. The Japanese extend significant economic
assistance to the Chinese in various modernization projects.
At the same time, Japan has maintained economic but not
diplomatic relations with Taiwan, where a strong bilateral
trade relationship thrives.

Japanese ties with South Korea have improved since an
exchange of visits in the mid-1980s by their political
leaders. R.O.K. President Kim Dae-jung had a very successful
visit to Japan in October 1998. Japan has limited economic
and commercial ties with North Korea. Japanese normalization
talks halted when North Korea refused to discuss a number of
issues with Japan. Japan strongly supports the U.S. in its
efforts to encourage Pyongyang to abide by the nuclear
Non-Proliferation Treaty and its agreements with the
International Atomic Energy Agency (IAEA). Despite the
August 31, 1998 North Korean missile test which overflew the
Home Islands, Japan has repeated its support for the Korean
Energy Development Organization (KEDO) and the Agreed
Framework, which seek to freeze the North Korean nuclear
program.

Russo-Japanese relations have warmed considerably since
1996, despite the fact that Russia continues to claim and
occupy the Northern Territories, small islands off the coast
of Hokkaido occupied by the U.S.S.R. at the end of World War
II. But recent summits in 1997 and 1998 between former PM
Hashimoto and President Yeltsin have accelerated work on a
peace treaty that would settle the Northern Territories
dispute and normalize bilateral relations. To further mutual
confidence and trust, Japan has pledged about $4 billion to
various programs designed to bolster Russian democracy and
economic reform.

Beyond its immediate neighbors, Japan has pursued a more
active foreign policy in recent years, recognizing the
responsibility that accompanies its economic strength. It
has expanded ties with the Middle East, which provides most
of its oil. Japan increasingly is active in Africa and Latin
America and has extended significant support to development
projects in both regions. And a Japanese-conceived peace
plan became the foundation for nationwide elections in
Cambodia in 1998.

After the Iraqi invasion of Kuwait in August 1990, Japan
adopted tough sanctions against Iraq and strongly supported
the UN effort against the aggression. Japanese financial
support for the Gulf war reached $14 billion. Japan actively
supported the Israel-Palestine peace framework. From October
1993, Japan has contributed $300 million to Palestinian
reconstruction. Under the framework of the Middle East Peace
Process, Japan chairs the multilateral working group on
environment and participates in other working groups.

In the 1990s, Japanese military and police forces as well as
civilians have participated in a wide variety of UN
peacekeeping missions. These have included Cambodia (two
Japanese citizens were killed in that effort), Mozambique,
the Golan Heights, and relief efforts for Rwandan refugees
in what was then Zaire (now Congo). Japan did not send any
Self-Defense Force units to Somalia but financed much of the
effort there with a $100 million contribution. In 1998, the
Japanese Self-Defense Forces conducted its first-ever
overseas military relief operation. The Japanese military
dispatched 105 personnel to Central America to provide
humanitarian disaster relief in Honduras and Nicaragua in
the wake of Hurricane Mitch.

Development assistance is a major tool of Japan's foreign
policy. Japan has been the world's largest aid donor since
1989, with aid levels of $9 billion. Japanese aid to other
Asian countries exceeds that of the United States, and Japan
also is a major donor to central and eastern Europe, Latin
America, and the Middle East. Japan and the United States
hold regular consultations to coordinate foreign assistance
programs. The United States supports Japan's efforts to open
its markets to developing nations' products.

U.S.-JAPAN RELATIONS

The United States' close and cooperative relationship with
Japan is the cornerstone of U.S. policy in Asia and the
basis of a strong, productive partnership in addressing
global issues. Despite different social and cultural
traditions, Japan and the United States have much in common.
Both have open, democratic societies, high literacy rates,
freedom of expression, multiparty political systems,
universal suffrage, and open elections. Both have highly
developed free-market industrial economies and favor an open
and active international trading system. As noted, Japan is
one of the three major industrial complexes among the market
economies, along with North America and western Europe. The
U.S. supports Japan's goal of obtaining a permanent seat on
the United Nations Security Council.

Because of the two countries' combined economic and
technological impact on the world (together accounting for a
little more than 30% of world GDP and 60% of the Western
industrialized nations' GDP), the U.S.-Japan relationship
has become global in scope. The two governments have
developed a partnership to address shared priorities. An
example of that partnership is the U.S.-Japan "Common Agenda
for Global Issues," a set of initiatives in areas such as
the environment, technology development, and health. Under
the Common Agenda, the United States and Japan are
coordinating $12 billion in population and HIV/AIDS
assistance to developing countries and are conducting joint
research on advanced transportation and environmental
technologies. The two governments also are cooperating
closely on issues as diverse as ocean pollution, children's
vaccines, narcotics demand reduction, the role of women in
development, and the protection of forests and coral reefs.

Security Relations

The U.S.-Japan security alliance remains indispensable to
the defense of Japan and to U.S. security strategy in East
Asia. The U.S.-Japan Treaty of Mutual Cooperation and
Security came into force on June 23, 1960. Under the treaty,
Japan hosts a carrier battle group, the III Marine
Expeditionary Force, the 5th Air Force, and elements of the
Army's I Corps. At the end of U.S. occupation in 1952, U.S.
military forces in Japan numbered around 260,000. The U.S.
currently maintains over 40,000 forces in Japan, more than
half of whom are stationed in Okinawa. Japan's Host Nation
Support (HNS) helps to defray about 75% of the costs of
maintaining these forces in Japan. In Okinawa, initiatives
begun under the U.S.-Japan Special Action Committee on
Okinawa (SACO) are returning tracts of military base land to
Okinawans, as well as making U.S. military activity on the
island less intrusive to Okinawan residents.

Japan's Self-Defense Force has gradually expanded its
capabilities and assumed primary responsibility for the
immediate conventional national defense. The SDF mission,
which the United States supports, is the defense of Japan's
homeland, territorial seas and skies, and sea lines of
communication out to 1,000 nautical miles. As a matter of
policy, Japan has forsworn nuclear armaments and forbids
arms sales abroad. A bilateral agreement signed in 1983,
however, allows the export of Japanese defense and dual-use
technology to the United States. Despite the changes in the
post-Cold War strategic landscape, the U.S.-Japan alliance
continues to be based on shared vital interests. These
include stability in the Asia-Pacific region, the
preservation and promotion of political and economic
freedoms, support for human rights and democratic
institutions, and securing of prosperity for our people and
other people of the region.

Economic Relations

U.S. economic policy toward Japan is aimed at increasing
access to Japan's markets, stimulating domestic demand-led
economic growth, and raising the standard of living in both
the U.S. and Japan. The U.S.-Japan bilateral economic
relationship is strong, mature, and increasingly
interdependent. It is based on enormous flows of trade,
investment, and finance. It is firmly rooted in the shared
interest and responsibility of the U.S. and Japan to promote
global growth, open markets, and a vital world trading
system.

In addition to bilateral economic ties, the U.S. and Japan
cooperate closely in multilateral fora such as the World
Trade Organization (WTO), Organization for Economic
Cooperation and Development, the World Bank, and the
International Monetary Fund, and regionally in the
Asia-Pacific Economic Cooperation forum (APEC).

Japan is a major market for many U.S. manufactured goods,
including chemicals, pharmaceuticals, photo supplies,
commercial aircraft, nonferrous metals, plastics, and
medical and scientific supplies. Japan also is the largest
foreign market for U.S. agricultural products, with total
agricultural imports valued at close to $17 billion in 1996.

Bilateral trade has increased dramatically over the decade.
U.S. exports to Japan reached $57.8 billion in 1998, down,
due to Japan's recession, from $67.6 billion in 1996 but up
from $47.9 billion in 1993. U.S. imports from Japan were
$121.8 billion in 1998, up from $102.2 billion in 1993.

However, U.S. businesses continue to face structural
obstacles in Japan, ranging from time-consuming customs
clearance to anticompetitive practices to government
regulation. The U.S. Government shares the view of many in
Japan who believe that Japanese deregulation is crucial for
Japan's long-term economic growth. The U.S. Government is
addressing the sectoral, structural, and macroeconomic
issues in the bilateral economic relationship through the
"Framework for a New Economic Partnership," signed in June
1993 by President Clinton and then-Prime Minister Miyazawa
and renewed in June 1995. Under the Framework, the U.S. has
concluded with Japan the Enhanced Initiative on
Deregulation, as well as agreements to expand market access
in such important sectors as telecommunications, medical and
pharmaceutical products, autos and parts, agricultural
products, insurance, flat glass, financial services, and
civil aviation.

The U.S. also has successfully pursued WTO cases against
Japan to increase market access for distilled spirits and
for agricultural products. Building on research that
demonstrates that trade follows investment, the U.S. also
has held discussions with Japan to address the structural
features of the Japanese economy that impede the inflow of
foreign direct investment. Japan continues to host a far
smaller share of global foreign direct investment than any
of its G-7 counterparts. U.S. discussions with Japan aim to
improve the environment for mergers and acquisitions so that
U.S. firms can establish a presence in Japan without having
to build one from the ground up; to recruit qualified
Japanese employees; and to cut entry costs for U.S. firms by
promoting the efficiency of the land market.

U.S. foreign direct investment in Japan reached $38.2
billion in 1998, up from $31.1 billion in 1993. New U.S.
investment was especially significant in financial services,
internet services, and software, generating new export
opportunities for U.S. firms and employment for U.S.
workers.

Principal U.S. Embassy Officials

Ambassador--Thomas Foley
Deputy Chief of Mission--Christopher LaFleur
Economic Minister-Counselor--Michael Michalak
Political Minister Minister-Counselor--James Foster
Consul General--John Dinger
Commercial Minister--Samuel H. Kidder
Defense Attache--Capt. Jeffrey Crews, USN

The street address and the international mailing address of
the U.S. embassy in Japan is 10-5 Akasaka 1-chome,
Minato-ku, Tokyo (107); tel. 81-3-3224-5000; fax
81-3-3505-1862. The APO mailing address is American Embassy
Tokyo, Unit 45004, Box 258, APO AP 96337-5004. U.S.
consulates general are in Osaka, Sapporo, and Naha, and
consulates are in Fukuoka and Nagoya. The American Chamber
of Commerce in Japan is at 7th floor, Fukide No. 2 Bldg.,
1-21 Toranomon 4-chome, Minato-ku, Tokyo (105).

TRAVEL AND BUSINESS INFORMATION

The U.S. Department of State's Consular Information Program
provides Consular Information Sheets, Travel Warnings, and
Public Announcements. Consular Information Sheets exist for
all countries and include information on entry requirements,
currency regulations, health conditions, areas of
instability, crime and security, political disturbances, and
the addresses of the U.S. posts in the country. Travel
Warnings are issued when the State Department recommends
that Americans avoid travel to a certain country. Public
Announcements are issued as a means to disseminate
information quickly about terrorist threats and other
relatively short-term conditions overseas which pose
significant risks to the security of American travelers.
Free copies of this information are available by calling the
Bureau of Consular Affairs at 202-647-5225 or via the
fax-on-demand system: 202-647-3000. Consular Information
Sheets and Travel Warnings also are available on the
Consular Affairs Internet home page:
http://travel.state.gov. Consular Affairs Tips for Travelers
publication series, which contain information on obtaining
passports and planning a safe trip abroad are on the
internet and hard copies can be purchased from the
Superintendent of Documents, U.S. Government Printing
Office, telephone: 202-512-1800; fax 202-512-2250.

Emergency information concerning Americans traveling abroad
may be obtained from the Office of Overseas Citizens
Services at (202) 647-5225. For after-hours emergencies,
Sundays and holidays, call 202-647-4000.

Passport information can be obtained by calling the National
Passport Information Center's automated system ($.35 per
minute) or live operators 8 a.m. to 8 p.m. (EST)
Monday-Friday ($1.05 per minute). The number is
1-900-225-5674 (TDD: 1-900-225-7778). Major credit card
users (for a flat rate of $4.95) may call 1-888-362-8668
(TDD: 1-888-498-3648). It also is available on the internet.
Travelers can check the latest health information with the
U.S. Centers for Disease Control and Prevention in Atlanta,
Georgia. A hotline at 877-FYI-TRIP (877-394-8747) and a web
site at http://www.cdc.gov/travel/index.htm give the most
recent health advisories, immunization recommendations or
requirements, and advice on food and drinking water safety
for regions and countries. A booklet entitled Health
Information for International Travel (HHS publication number
CDC-95-8280) is available from the U.S. Government Printing
Office, Washington, DC 20402, tel. (202) 512-1800.

Information on travel conditions, visa requirements,
currency and customs regulations, legal holidays, and other
items of interest to travelers also may be obtained before
your departure from a country's embassy and/or consulates in
the U.S. (for this country, see "Principal Government
Officials" listing in this publication).

U.S. citizens who are long-term visitors or traveling in
dangerous areas are encouraged to register at the U.S.
embassy upon arrival in a country (see "Principal U.S.
Embassy Officials" listing in this publication). This may
help family members contact you in case of an emergency.

Further Electronic Information

Department of State Foreign Affairs Network. Available on
the Internet, DOSFAN provides timely, global access to
official U.S. foreign policy information. Updated daily,
DOSFAN includes Background Notes; daily press briefings;
Country Commercial Guides; directories of key officers of
Foreign Service posts; etc. DOSFAN's World Wide Web site is
at http://www.state.gov.

National Trade Data Bank (NTDB). Operated by the U.S.
Department of Commerce, the NTDB contains a wealth of
trade-related information. It is available on the Internet
(www.stat-usa.gov) and on CD-ROM. Call the NTDB Help-Line at
(202) 482-1986 for more information.

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