[Title] Address by Prime Minister Kiichi Miyazawa at the National Press Club

President Spears,

Distinguished Guests,

Ladies and Gentlemen,

It is a privilege to speak in this tradition-honored club.

I first became involved in Japan-U.S. relations in 1939. As a member of the Japanese delegation to the Japan-America Student Conference, I came to the United States to discuss the future of Japan-U.S. relations with American students. Flora Lewis, who is dear to you all, is one of the American alumni from those years.

Throughout my experiences in the various chapters of the relationship between our two countries, the free, resilient and well-balanced ethos of American society, especially the American press, has never ceased to impress me. I am sure you agree with me that Flora Lewis is living proof that intellectual curiosity keeps one active, alert and young. If I have managed to remain a young "new leader" in Japanese politics for such a very long time, I owe it largely to the intellectual stimuli that I gained through my exposure to America and my American friends.

Ladies and Gentlemen,

With the Cold War behind us, we have an historic opportunity to create a more peaceful and more prosperous world where life is better for an ever-greater number of people of this and succeeding generations. The key to our success is international cooperation. Above all, the cooperation between Japan and the United States, which together account for 40 percent of the world's GNP, is of crucial importance.

Recognizing this, President Bush and I announced last January in Tokyo our resolve to pursue the Global Partnership, in which Japan and the United States will cooperate on a broad range of international issues ranging from political and economic cooperation to scientific probes into the unknown.

In fact, our Global Partnership is unfolding worldwide, from assistance to the New Independent States (NIS) to our joint endeavors in Central and South America, the Middle East and Africa as well, of course, as in Asia. The most recent case in point is the announcement Japan made in the course of Vice President Quayle's visit to Japan last May. In close cooperation with American Enterprise Funds, which are providing $450 million of assistance, we will extend up to $400 million of additional financing to Eastern and Central Europe. Japan's financial support to Eastern and Central Europe since the collapse of the Berlin Wall already exceeds $4.5 billion.

Ladies and Gentlemen,

Today I wish to focus on the Asia-Pacific region to illustrate how Japan intends to expand this Global Partnership with the United States. I do this because I feel that, although the democratization and economic reform in the former Soviet Union and Eastern Europe are now the focus of international attention, momentous changes are also occurring in the Asia-Pacific region. These changes are often overlooked by the Euro-Atlantic Community, but I believe that these changes will play an important part in our search for new international cooperative relationships for the peace and prosperity of the world.

Many countries in the region feel that Japan and the United States are well placed to help them seize the opportunity to bring about more enduring peace and greater prosperity to the region.

The Asia-Pacific region is characterized by its cultural, linguistic, and economic diversity. And yet the economies are closely inked. Drawing strength from this diversity and interdependence, the region has registered phenomenal economic growth in recent years, as exemplified by the Newly Industrialized Economies (NIEs) and the ASEAN countries. According to a projection, the Asia-Pacific region may develop into a market as large as Europe or North America by around 2015. There is no doubt that the region's economic dynamism will continue to provide strong momentum for the expansion of the world economy in the rest of the century and beyond.

Japan has been actively cooperating with these countries in their nation-building efforts. In fact, half of Japan's ODA is directed every year toward the developing countries in the region. Not only do we intend to continue such economic cooperation, but we also hope to play a positive role in promoting this region's political stability.

The United States, of course, has been engaged in the Asia-Pacific region since the last century. American involvement has been a central factor for the region's peace and prosperity. The economic ties between the United States and this region are getting ever more important and far-ranging. U.S. trans-Pacific trade far exceeds its Atlantic trade, and its investment in Asia has also increased substantially in recent years. Given the region's economic potential, they are expected to expand further.

Needless to say, the U.S. presence and engagement remain vitally important for the peace and prosperity of the region. It is broadly perceived in the region that the presence of U.S. forces serves as a stabilizing factor not only in military terms but also in political terms. It is earnestly desired that the United States will maintain its forward deployment in the region.

The Japan-U.S. security arrangements provide the essential support for this forward deployment. The "Overseas Family Residency Program" in Japan for the crews of 15 U.S. naval vessels including an aircraft carrier greatly facilitates the presence and operation of U.S. forces in the region. Japan's host nation support amounts to $4 billion in fiscal 1992, and is projected to account for 70 percent of the non-salary cost of U.S. forces in Japan by Fiscal 1995.

I consider such support by Japan to be an essential prerequisite to the continued U.S. commitment to Asian-Pacific security. The Japanese Government will strive further to ensure the smooth operation of its security arrangements with the United States and to enhance the credibility of these arrangements through various means including the further improvement of its host nation support.

Ladies and Gentlemen,

Political cooperation between Japan and the United States, based on these economic and security underpinnings, is also a vital component of our partnership in the Asia-Pacific region. It is in this context that we should consider the potential conflicts and disputes which still persist in the region. Some of these involve military tension, as in the cases on the Korean Peninsula or in Cambodia. The solution in each of these case requires a carefully considered approach best suited to the particular circumstances.

On the Korean Peninsula, over 1.4 million ground troops remain in a state of confrontation across the 38th parallel. The reduction of this tension is the most pressing task today for the security of the Asia-Pacific region. The North-South dialogue for reconciliation needs to be supported by the close cooperation among the four major powers involved, that is, Japan, the United States, China and Russia. The trilateral cooperation now underway among Japan, the United States and the Republic of Korea on the question of North Korea's nuclear weapons development signifies the beginning of such multilateral cooperation.

Serious concern persists about North Korea's possible nuclear weapons development. If this should prove to be true, it would be a serious destabilizing factor for the security of East Asia and of the world. North Korea's acceptance of the International Atomic Energy Agency (IAEA) inspection signals some progress. However, all the concerned parties must work on North Korea to dispel fully the suspicion of the international community. Japan, for its part, is resolved to work to this end by firmly maintaining the position in its normalization talks with North Korea that there can be no normalization of relations with North Korea without a solution to this issue.

The other urgent security issue is Cambodia's peace process. I cannot help but express grave concern over the fact that one Cambodian party of late is impeding the smooth progress of the peace process. The ongoing operation of the United Nations Transitional Authority in Cambodia (UNTAC) is an unprecedented grand undertaking. Its success or failure will be a crucial test case for the United Nations' peace-keeping ability in the post-Cold War period. We must further strengthen our support for the peace process; we must ensure that the cease-fire be maintained, troops be demobilized, and refugees be repatriated, so that Cambodia can promptly start its reconstruction under the new government to be established through the free and fair election to be held next year.

Less than two weeks ago, Japan hosted in Tokyo the Ministerial Conference on Rehabilitation and Reconstruction of Cambodia. With cooperation from the participants, the Conference put together a total pledge of $880 million of assistance for the rehabilitation and reconstruction of Cambodia. In addition, the Conference participants, including all the Cambodian parties, reconfirmed the importance of the full and timely implementation of the Paris Peace Agreement. I earnestly hope that this will favorably affect the peace process. The outstanding role the United States played with Japan in this Conference was a telling example of our Global Partnership.

With the International Peace Cooperation Law enacted, Japan envisages future participation in the UNTAC process through personnel support, thus contributing to the nation-building of postwar Cambodia.

In parallel with these bilateral and sub-regional approaches to the instabilities in the region, it is also important to build a region-wide framework for political dialogue encompassing a broader spectrum of countries. I believe that the Post-Ministerial Conference of ASEAN (ASEAN-PMC), at which ASEAN foreign ministers meet their counterparts form the United States, Japan, Australia, New Zealand, Canada, the EC, and the Republic of Korea, may, for now, most usefully serve this purpose. I heartily welcome the decision of the ASEAN Summit last January which points in this direction.

The Asia Pacific Economic Cooperation (APEC) ministerial meeting provides another possible framework for dialogue. APEC was originally intended to promote economic cooperation, but in the Asia-Pacific region, where many of the countries are developing, economic cooperation is an important means to achieve regional stability.

With the participation of China, Hong Kong and Taiwan last year, the three-year-old APEC now involves almost all major economic entities in the Asia-Pacific region, and its aggregate GNP accounts for roughly half of the world's output. Japan is resolved to work together with the United States and other participants to invigorate the activities of APEC, which strives for open regional cooperation. We will spare no efforts, as part of the Global Partnership, to see that the APEC ministerial meeting to take place next year in the United States will be successful and productive.

In sum, I believe that the most effective approach to Asian-Pacific security is a two-track approach, that is, the promotion of sub-regional cooperation to settle disputes and conflicts and region-wide political dialogue to enhance the sense of mutual reassurance.

The task remains for the future to involve China and Russia in such process of dialogue and cooperation as constructive participants. It goes without saying that the stability and development of China are significant for the peace and prosperity of the Asia-Pacific region. I therefore applaud the decision of the U.S. Government to extend the MFN treatment to China for another year.

China is now at a great historic turning point. We must continue to encourage and support China's vigorous efforts for openness and reform in the economic sphere. In that process, we must also make our concern known to China about its political reform, including its human rights situation. At the same time, we need to appreciate that, for a country like China with more than one billion people and a low national income, the expansion of its national economy is indispensable for its domestic stability. Economic reforms should pave the way for political reforms.

We must also get China involved in the international efforts for peace. China's participation is particularly necessary in such areas as nuclear non-proliferation, the missile technology control regime and the control of transfer of conventional weapons.

Russia is, of course, an important neighbor of Japan. It is also vital for Asian-Pacific stability. Improved Russo-Japan relations are naturally essential for the stability of the region. We need to support Russia's efforts at democratization and the introduction of a market economy. Japan has actively joined the other industrialized democracies in assisting the Soviet Union and now the New Independent States. We have done this in spite of the unlawful occupation of Japan's Northern Territories by the Soviet Union and its successor, Russia. Japan is also stepping up its efforts to expand its dialogue and exchanges with Russia.

Let me be clear, however, that neither Japan nor Russia can hope to press ahead without solving the Northern Territories question. I can easily imagine how the Russian people, who have long been taught that these islands are Russian territory, may face a strong psychological block in coming to terms with the return of these islands to Japan. However, for our two countries to act as if the problem did not exist would only complicate the matter further and prolong the state of uncertainty in our relations. It is then necessary, in parallel with providing assistance to Russia, to help the Russian Government and people grasp fully the importance of settling this territorial issue.

This is not merely a bilateral issue between Japan and Russia. Whether Russia will solve this issue in accordance with law and justice as stated by President Yeltsin will test Russia's readiness to shed its Stalinist vestige and become a truly constructive member of the international community, which shares fundamental values with us. The Government and people of Japan highly appreciate the U.S. Government's firm support for Japan's position on this issue. President Yeltsin's planned visit to Japan this fall will be a very important opportunity toward the settlement of the Northern Territories issue, and we are seriously stepping up our efforts to prepare for it.

I look forward to further support from the United States, whose cooperative relationship with Russia has been strengthened through President Yeltsin's recent visit to the United States.

Ladies and Gentlemen,

Stable growth of the world economy is another important aspect of our Global Partnership. To secure harmonious economic development for all, our urgent task is to overcome the temptation of protectionism and closed regionalism, and to build more open international trade and economic systems.

Japan's most significant role in world economic management lies in ensuring sustained growth of the Japanese economy without inflation, and, against such background, in achieving a better quality of life for its people.

With the world economy still teetering on its recovery path, I intend to ensure sustained growth of the Japanese economy. For fiscal 1992 I have already compiled a budget with the maximum consideration given to the state of the economy. I have been exerting maximum possible efforts to effect additional expansionary measures including the front-loading of the public works projects. In case these measures do not bring sufficient effect, I will examine the situation and undertake every possible means including substantial additional fiscal measures, keeping in mind the objectives set out in the new Five-Year Economic Plan.

In the medium-to long-term, I consider it important to ensure that the Japanese people can live a rewarding life in keeping with the country's economic strength. If anything, the Japanese economy has tended to be producer-oriented. I believe that we must gradually shift our economy's focus from producers to consumers and to ordinary citizens and their families. For this purpose, we are endeavoring to shorten working hours, improve social overhead capital such as parks, greenery, and public facilities, so as to create high quality living environment. Our efforts to build an economy in which each individual can relish his or her daily life agrees with what the international community expects of Japan.

These Japanese efforts should make our bilateral economic relations more solid and enduring, the vital aspect of our overall relations. My focus on Asia-Pacific today should in no way be interpreted as a lack of attention to this vital aspect. I am well aware that our two countries are facing tremendous challenges in this area.

Our trade relations require strong political alertness and constant attention from both sides. In order for our Global Partnership to move forward, however, we cannot afford otherwise. It is exactly for this reason that President Bush and I announced The Plan of Action on our trade and economic relations last January.

Since then, my government has been working hard with Japanese businesses and industries in various sectors, particularly those mentioned in The Plan of Action, to increase market access opportunities for foreign products. We are making solid progress. Combined with our macroeconomic efforts as well as with American endeavors to cut budget deficits and enhance competitiveness, this exercise is expected to produce positive results.

Let me here make one point about economic and trade issues. Some people use an analogy of Cold-War military confrontation when analyzing international economic relations. They tend to view economic competition as something confrontational or adversarial. They even suggest that one country's economic success is a threat to another. However, the world economy is not a zero-sum game. It is a positive-sum game, in which all participants can gain. This is so because we are increasingly interdependent economically, and will be all the more so if we maintain and strengthen the open international economic system.

Ladies and Gentlemen,

The world is undergoing historical changes. So is America. America has always stood up to challenges of the time, upholding the ideals of its Founding Fathers. This has been possible because of the country's resiliency, vitality, and creativity; the traits I admire in the American people. I am confident that America, together with the rest of the world, will demonstrate once again its courage and resourcefulness in surmounting today's challenges.

The world needs American leadership. An isolationist America would be everyone's nightmare. The Japan-U.S. Global Partnership certainly expects the United States to retain its overseas commitment and remain internationally engaged. I assure you that Japan, on its part, will fulfill its roles and responsibilities commensurate with its national strength and international standing.

Thank you.