The Structural Impediments Initiative: An Example of Bilateral Trade Negotiation
![handle is hein.journals/mjil12 and id is 446 raw text is: THE STRUCTURAL IMPEDIMENTS
INITIATIVE: AN EXAMPLE OF
BILATERAL TRADE NEGOTIATION
Mitsuo Matsushita*
INTRODUCTION
In June 1990, the governments of the United States and Japan con-
cluded the Structural Impediments Initiative (SII), a series of bilat-
eral trade negotiations.! The SII came about as a result of a large
trade imbalance between the two countries in favor of Japan, which,
despite many efforts, the United States and Japan had been unable to
reduce. It was the U.S. government's perception that the real cause of
the trade imbalance was not Japan's protective border measures in the
form of tariffs or quantitative restrictions, such as import quotas on
agricultural and leather products, but rather the oligopolistic indus-
trial sector in which large companies linked together by stock-holdings
and interlocking directorates exclude outside parties from transac-
tions. This perception on the part of the United States was what initi-
ated the SII.
The SII is unique in the sense that it dealt with subjects not usually
on the agenda of international trade negotiations. Most of the SII ne-
gotiations concerned matters of domestic policy and regulation, such
as public expenditure, land use policy, restrictive business behavior,
close inter-corporate relationships and the system by which goods are
distributed. Not surprisingly, the SII was criticized both in the United
States and Japan. Japanese critics felt that the U.S. government was
trying to interfere with Japanese domestic matters. In the United
States, some critics believed that the SII would have a minimal effect,
if any, on the trade imbalance.
Nevertheless, the SII serves an important function as a model for
future trade negotiations. As international economic relationships be-
come closer and trade restrictions in the form of border measures de-
crease, it becomes increasingly important to reduce differences
between national economic institutions and to harmonize both formal
* Professor of Law, University of Tokyo; Visiting Professor of Law, University of Michigan
Law School, 1990.
I. The Final Report of the SII was submitted to President Bush and Prime Minister Kaifu on
June 28, 1990. JOINT REPORT OF THE U.S.-JAPAN WORKING GROUP ON THE STRUCTURAL
IMPEDIMENTS INITIATIVE (1990) [hereinafter SII REPORT].](ViewImageLocal?handle=hein.journals/mjil12&div=21&collection=&method=preview&ext=.png&size=3)
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The Structural Impediments Initiative: An Example of Bilateral Trade Negotiation
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