At the present time, our relationship with Japan is friendly and mutually advantageous. The volume of trade between our two countries in 1961 was about $2.7 billion. In this exchange, the United States enjoyed an export surplus of more than $700 million. Japan is a major and expanding market for American agricultural commodities, for industrial machinery, and for raw materials. It is the scene of important American investments. Many U.S. companies enjoy close and profitable licensing relationships with Japanese firms. As the most rapidly growing industrial economy in the world, Japan offers to American business and industry one of its most important opportunities for future trade expansion.

Politically, Japan is a stable democracy in a generally unstable and gravely threatened area of Asia. As an example of the workability of a free society in an Asian setting, it is of the utmost importance to the free world. Japan has become an important contributor of assistance to the less developed countries in Asia and elsewhere. We are party to a bilateral defense understanding with Japan which allows our forces access to major air and naval bases in Japan. These bases are of the highest value to the maintenance of an American defense capability in the Western Pacific.

The close relations obtaining between the United States and Japan of course do not preclude or prevent the appearance of difficulties between us. The very magnitude of our trade and the presence of large numbers of American personnel in Japan almost assure that we shall have problems to be managed or solved, as circumstances and our abilities permit. It is the Department's firm view, nonetheless, that our abiding national interest lies in keeping our relations with Japan free of avoidable irritations, the cumulative impact of which could seriously damage our friendly relationship.

In the Department's opinion, H.R. 9547 could not fail to affect our relations with Japan adversely and without contributing effectively to any specific U.S. objective.

Finally, I should like to comment to the committee on the unfortunate policy implications that are presented by H.R. 9547. The central feature of this legislation would be to apply an embargo on Japanese exports of salmon to the United States in the event that the Japanese salmon fishery did not observe procedures laid down by the Government of the United States.

The threat of a trade embargo to accomplish a different objective is one that we should examine with the utmost care. If we look at the matter narrowly, we must recognize that our commodity exports as a nation far exceed our commodity imports. In the case of Japan itself, our exports last year were $700 million greater than our imports. Although this was an exceptional year, it is almost always the case that we sell much more to Japan than we buy from Japan.

In a world in which the use of trade embargoes to accomplish national objectives became general, we would be the greatest sufferers since our export trade is both the largest absolutely and since we also normally have the largest surplus of exports over imports.

This is to look at it in narrowest terms, however. The introduction of the embargo weapon into international commerce would be destructive of the very fabric of the free world. The processes of retaliation and counterretaliation in the field of trade would inevitably affect our political and defense relations to the point at which there would

be real danger that the basic unity of the non-Communist world would be gravely endangered.

I do not believe, Mr. Chairman, that this Government should take an action which would provide such an unfortunate precedent for other nations in the all-important field of trade. For this basic policy reason, as well as because we believe H.R. 9547 would not contribute to our conservation objectives, the Department finds itself in opposition to the legislation before you.

It is necessary to be clear, Mr. Chairman, about the potential coercive effect of H.R. 9547.

In the opinion of the Department, the practical effect of this bill in terms of persuading the Japanese to act according to our objectives would be very limited indeed. The United Kingdom is Japan's major market for canned salmon. Since 1958, when the United Kingdom liberalized its imports, 60 to 70 percent of total Japanese exports of canned salmon have gone to the United Kingdom. The United Kingdom market is growing and the Japanese and British are now negotiating a new commercial treaty that will improve trade relations between the two countries.

The American market, which accounted for 25 percent of Japan's exports in 1956 and 1957, took only 7.7 percent in 1960 and 6.6 percent-in dollar value, $2.7 million in 1961. Thus, the sacrifice involved in giving up the American market completely would be small in any case. The Government of Japan well might find it acceptable. The Department does not wish to underestimate the obstacles that stand in the way of solving the problem of the Alaskan salmon resource in relation to Japan. It does believe, however, that patient and persevering diplomacy may be able to confirm in being a pattern of de facto Japanese limitations in sensitive fishing zones that will give our authorities a better basis than in the past for their own salmon conservation measures.

I should point out, finally, that major opportunities for discussions. of the Alaskan salmon question will be provided by the November meeting of the International North Pacific Fisheries Commission and by the meeting in December of the Cabinet ministers of the two countries. These will supplement the opportunities for interchanges between officials both in Washington and in Tokyo.

In my view, it would be a grievous mistake to risk foreclosing these possibilities for constructive exchanges with the Japanese by passage of H.R. 9547 and risk, among other things, making more difficult negotiations regarding the extension of the North Pacific Convention itself with all its desirable influence on the salmon industry. Thank you, Mr. Chairman.

Mr. DINGELL. We are grateful to you for your appearance.

The Chairman would like to note your testimony is with regard to H.R. 9547.

I also notice you have a number of your staff present this morning. If you desire to have any of them sit next to you while you are at the the table, you will be most welcome to do so.

Mr. HARRIMAN. Mr. Trezise is here.

Mr. PELLY. I would first of all like to commend the Secretary for his expression of support of the doctrine of abstention; in other words, where one nation agrees to protect and help conserve a resource of another nation where the other nation has exercised conservation

practices. I think that is the crux of the difference in viewpoint between the Japanese and ourselves.

Mr. Secretary, I remember onetime Secretary Herter stated that the Department supported abstention, and that was the only statement I ever heard until yours. I am very glad to hear it because I think it is the one hope we have for agreement on conservation.

I would like to say to you that I feel the Department has overemphasized this legislation as a boycott or a ban, whereas its objectives are truly those of conservation.

The Canadian and American fishermen are prohibited from fishing by nets beyond the 3-mile limit in order to assure sufficient escapement gets up the streams.

The Japanese have used 10-mile-long nets that catch the small and immature fish. The Japanese, as the Secretary has stated, have lived up to their agreement. We do not think they have lived up to the spirit of that agreement as far as abstention is concerned.

Those Bristol Bay red salmon do go to the westward of that line, that 175 meridian. I can only assure you, as the author of the bill, that we have only one interest, and that is conservation.

I do not have any particular questions to direct to you. I am more interested in the Department of Interior's views.

I regret very much that you do not support the bill.

It is true, is it not, the treaty of 1953 provides for changes and it would not prevent a change in that line east of which the Japanese agreed not to fish?

Is it not true we have found by tagging of fish and by other research our fish do commingle with other salmon and go to the west of that line which was originally agreed to in the treaty?

That is correct, is it not? The treaty is such it can be opened up at any time?

Mr. HARRIMAN. Yes; any subject can be opened up at any time in regard to our mutual problems of fisheries. I cannot help feeling that whoever was in the Department negotiating this agreement-I would like to put in the record the map showing the area of the Pacific which is excluded by the convention and the protection it gives to all of the Pacific salmon, U.S. Pacific salmon, from any catch by the Japanese.

It is true there is a conflict in one type of salmon, which is a subject which should be negotiated, in my opinion and, considering what the Japanese have given up in the past by negotiation, we should not use punitive measures in order to attempt to achieve our national objectives. The December meeting to which I have referred will be between the members of the Cabinet, not only the Japanese, not only with the State Department, but with Mr. Udall, Secretary of the Interior who will participate as he did in the discussions last year at Hakone in Japan. So the point of view of the Department of the Interior will find expression in the discussions as it always does, in any event.

I might also point out the Department of State must consider this very large trade which we have with Japan and with regard to the principle that you speak of, which you applaud, restraint, I think it is fair to say Japan in other areas of trade has been more restrained than perhaps almost any other nation. They have voluntarily restrained their imports into the United States of a very considerable number of manufactured goods, including textiles, ceramics, et cetera.

practices. I think that is the crux of the difference in viewpoin between the Japanese and ourselves.

Mr. Secretary, I remember onetime Secretary Herter stated that the Department supported abstention, and that was the only statement I ever heard until yours. I am very glad to hear it because I think it is the one hope we have for agreement on conservation.

I would like to say to you that I feel the Department has over-c emphasized this legislation as a boycott or a ban, whereas its objectives, are truly those of conservation.

The Canadian and American fishermen are prohibited from fishing> by nets beyond the 3-mile limit in order to assure sufficient escapement gets up the streams.

The Japanese have used 10-mile-long nets that catch the small and immature fish. The Japanese, as the Secretary has stated, have lived up to their agreement. We do not think they have lived up to the spirit of that agreement as far as abstention is concerned.

Those Bristol Bay red salmon do go to the westward of that line, that 175 meridian. I can only assure you, as the author of the bill, that we have only one interest, and that is conservation.

I do not have any particular questions to direct to you. I am more interested in the Department of Interior's views.

I regret very much that you do not support the bill.

It is true, is it not, the treaty of 1953 provides for changes and it would not prevent a change in that line east of which the Japanese agreed not to fish?

Is it not true we have found by tagging of fish and by other research our fish do commingle with other salmon and go to the west of that line which was originally agreed to in the treaty?

That is correct, is it not? The treaty is such it can be opened up at any time?

Mr. HARRIMAN. Yes; any subject can be opened up at any time in regard to our mutual problems of fisheries. I cannot help feeling that whoever was in the Department negotiating this agreement-I would like to put in the record the map showing the area of the Pacific which is excluded by the convention and the protection it gives to all of the Pacific salmon, U.S. Pacific salmon, from any catch by the Japanese.

It is true there is a conflict in one type of salmon, which is a subject which should be negotiated, in my opinion and, considering what the Japanese have given up in the past by negotiation, we should not use punitive measures in order to attempt to achieve our national objectives. The December meeting to which I have referred will be between the members of the Cabinet, not only the Japanese, not only with the State Department, but with Mr. Udall, Secretary of the Interior who will participate as he did in the discussions last year at Hakone in Japan. So the point of view of the Department of the Interior will find expression in the discussions as it always does, in any event.

I might also point out the Department of State must consider this very large trade which we have with Japan and with regard to the principle that you speak of, which you applaud, restraint, I think it is fair to say Japan in other areas of trade has been more restrained than perhaps almost any other nation. They have voluntarily restrained their imports into the United States of a very considerable number of manufactured goods, including textiles, ramics, et cetera.