PRIVATE TRADING WITH JAPAN

Press, Volume LXXXIIi, Issue 25189, 21 May 1947, Page 5

PRIVATE TRADING WITH JAPAN

DETAILS OF U.S. PLAN DISCUSSED

The United States Department of State aims at July 15 as the date on which foreigners may resume private trading with the Japanese. Discussing this, the “New York Times” early this month said that if present plans matured, American and other businessmen would be permitted after that date to visit Japan in limited numbers and establish direct contact with Japanese manufacturers. All Japanese exports are handled now by the United States Commercial Company, a subsidiary of the Reconstruction Finance Corporation, which brings them to this country where they are sold either at auction or on a sealed bid basis.

The plan provides that private businessmen of foreign countries may g' ■> Japan, under a quota system becav of limited living accommodations, to contract directly with Japanese manufacturers for their products. However, there would be no price discussions between them.

The Japanese State Trading Corporation would pay the Japanese manufacturer in yen for whatever goods the foreigner selected. the yen price being based on cost of production plus a nominal profit. The goods then would be shipped to the foreign buyer, . who would pay for them by remitting to the Supreme Allied Command's export account in dollars, sterling, or other currency based on a fair world market value. The dollars or other currency would be held in the export account to pay for additional raw material imports for the Japanese manufac-

While this system would avoid the necessity for establishing a foreign commercial exchange rate for the yen, it would in effect provide some basis for determining such a rate when Allied officials believe the time is ripe to set it. Officials said the major difficulty in getting the plan into operation by July 15 lies in the acute housing shortage in Japan. A combined mission from Washington, which will complete arrangements for the plan, will also work with General MacArthur’s experts on the possibility of allowing American and other foreign businessmen to finance Japanese manufacturers by providing them with needed raw materials.