U.S.-Japan Trade

In response to a congressional request, GAO provided information on: (1) trade between the United States and Japan pertaining to the industrial sectors the Market-Oriented Sector-Selective (MOSS) trade talks covered; and (2) whether the MOSS agreements have helped U.S. firms conduct business in Japan.

GAO found that it was unable to fully measure and assess the effect of the MOSS talks because: (1) the countries did not implement all agreements' provisions at the same time, especially those pertaining to tariff reductions; (2) the Standard Industrial Classification (SIC) code the Department of State assigned to the MOSS sectors also covered other products not included in the agreements; (3) the United States and Japan have different approaches for reporting their import and export trade flow; and (4) it was necessary to use U.S. export data to track U.S.-Japan trade flow, since Japanese import data were not consistent with the SIC codes. GAO also found that: (1) 22 of the 30 firms it surveyed in the medical equipment and pharmaceutical sectors believed that business opportunities in Japan generally have improved since the talks; (2) most of these firms cited increased efforts by their companies as a primary reason for the changes; (3) 9 of the 19 firms that submitted product applications since the MOSS talks indicated that the talks had helped to ensure fair treatment; (4) only 3 of the firms believed that the talks increased their access to the Japanese market; and (5) most firms were satisfied with U.S. monitoring of the MOSS agreements and the level of official U.S. involvement.