CONSTRUCTION SANCTIONS URGED AGAINST JAPAN

CONSTRUCTION SANCTIONS URGED AGAINST JAPAN

A U.S. inter- agency trade group voted unanimously Thursday in favor of levying sanctions against Japan for not providing U.S. firms with access to Japan's public works projects.

The recommendation by the sub-Cabinet Trade Policy Review Group will be passed to the Cabinet-level Economic Policy Council, another interagency group headed by Treasury Secretary James A. Baker III, where a final recommendation will be prepared for President Reagan.This was the third time since last November that the trade group has voted in favor of retaliation against Japan on the construction issue under Section 301 of the Trade Act of 1974. But Economic Policy Council put off deciding on the issue each time.

Last November the council postponed consideration of the recommendation until after Commerce Secretary C. William Verity's trip to Japan. The second delay came because of the visit to Washington by Japanese Prime Minister Noboru Takeshita last month.

When you've got trade experts in the administration sending a signal like this . . . If the administration does not go along this time they better have a very good explanation, said Mark Chalpin, vice president of the National Constructors Association, a Washington-based trade association.

A congressional staffer said the policy council should rule by Wednesday on the proposal by 14-member Trade Policy Review Group.

A Washington lobbyist for the Japan Federation of Construction Contractors said he was not surprised at the group's vote and said he wouldn't be surprised to see the Cabinet approve the proposal next week.

The Japanese have been trying for some time to make some changes on this issue, but like everything else over there it takes time to build a consensus, said William H. Morris Jr., president of Global USA Inc., the lobbying firm representing the Japanese.

Japanese government officials seemed surprised to learn of the vote and would not comment directly.

We can only say we hope the negotiations presently under way between the two sides will have a satisfactory solution, said one Japanese official.

Sen. Frank Murkowski, R-Alaska, who has pressured the Japanese for several years to remove restrictions that limit U.S. firms from participating in the Kansai Airport project in Osaka Bay, said he was pleased with the vote and urged the policy council to take action next week.

Despite commitments made at the highest government levels, the Japanese market remains closed to U.S. construction services and supplies . . . When the Economic Policy Council meets next week I'm sure the Cabinet members will understand how seriously the Congress and U.S. industry view our inability to gain access to the Japanese market. The strongest possible action must be taken, including the self-initiation of a 301 investigation, the senator said.

A Senate staffer said that if the policy council did vote to impose sanctions on the Japanese, any investigation would likely be a short one

because the issue has been so thoroughly researched in the past year.

The investigation won't be a year; it'll be maybe 90 days, he said.