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SCMP Reporter

WASHINGTON: President Bill Clinton has decided to revive the most feared weapon in the US trade arsenal in an effort to keep up pressure on Japan to reduce a $59.3 billion trade gap between the two countries, Administration officials said yesterday.

  The Administration will use a trade law provision that could lead to retaliatory tariffs of up to 100 per cent on goods imported into the United States by countries deemed to have unfair barriers against American products.

  The officials said a formal announcement of the decision was planned for later in the day by US Trade Representative Mickey Kantor.

  Mr Clinton, arriving late for a scheduled appearance, apologised and said he had been talking by telephone to Japanese Prime Minister Morihiro Hosokawa.

  ''It was unavoidable. We had to make the call,'' Mr Clinton said, referring to the telephone call.

  One of the administration sources said that Mr Clinton placed the call to inform Mr Hosokawa of his decision to re-implement a section of US trade law known as Super 301.

  A congressional source said Mr Kantor was making telephone calls to members of Congress to inform them of the administration's decision to re-implement an expired section Super 301.

  The law, which was briefly in force from 1989 to 1990, sets up a ''hit-list'' of countries judged to have erected the most egregious trade barriers against American products.

  If 18 months of negotiations fail to remove the barriers, then the administration has the power to impose the retaliatory tariffs on exports from the offending country.

  Other nations, especially Japan, complained bitterly about the law, saying it allowed the United States to bully them into making trade concessions under threat of punitive tariffs.

  The law has strong backers in Congress.

   Two weeks ago, Sen Max Baucus, chairman of the Senate Finance subcommittee that handles trade matters, introduced legislation to re-impose Super 301, saying that while it was in effect it had been tremendously successful.

  Mr Clinton, talking about his phone call to Mr Hosokawa, said the two leaders had a ''friendly, forthright conversation that's consistent with the tone that we've established in our relationship. But it was one that I had to have today''.

   In his morning appearance Mr Clinton refused to say what his decision was. But administration and congressional sources said Mr Clinton had decided in favour of an executive order that would put the lapsed law back into effect.

  The Bush administration, which did not like having its hands tied by the strict deadlines set in the law, used it reluctantly to open Japanese markets in the area of super-computers, forest products and satellites.

   It also succeeded in eliminating certain trade barriers in Brazil.

  Mr Kantor left no doubt on Wednesday that the administration clearly favoured reviving the expired Super 301 provisions.

   He noted that Mr Clinton repeatedly has voiced his support for the lapsed law, dating back to his campaign for the presidency.

    Mr Clinton and Mr Hosokawa were forced to declare the framework talks deadlocked on February 11 over US demands that Japan set import goals for opening its markets.



Clinton unleashes Super 301