TOKYO Japan on Friday rejected U.S. demands for more access to Japan's auto market, saying the government has already taken steps to eliminate tariffs and non-tariff barriers.
The rebuff by the government's top spokesman came in reply to a statement the U.S. government submitted to the World Trade Organization on Wednesday saying, "a variety of non-tariff barriers impede access to Japan's automotive market."
The U.S. government also said Japan's agriculture sector remains protected by "substantial" barriers, offering the clearest indication yet of where battle lines will be drawn in a new economic dialogue between the two countries.
"We do not impose import tariffs on cars, and we do not impose any non-tariff barriers," Chief Cabinet Secretary Yoshihide Suga told reporters.
"Our position is that Japan's auto market is already open. This is something that will be settled in our bilateral dialogue."
In 2015 the U.S. government submitted a similar statement to the WTO as part of a regular review of Japan's trade policies, but this year's statement could carry more weight given the new U.S. administration's emphasis on renegotiating trade deals.
Japan's Deputy Prime Minister Taro Aso and U.S. Vice President Mike Pence will chair a joint dialogue that could re-write economic ties between the world's largest and third-largest economies.
Japanese officials have indicated that they would prefer the talks focuSsed on infrastructure, foreign direct investment and energy to avoid more thorny issues like autos and agriculture.
Japanese media say the dialogue could start as early as next month, but the White House has made no official announcement.
U.S. President Donald Trump rattled Japanese policymakers by criticising the small number of U.S. auto exports to Japan shortly after taking office in January.
Trump has also clearly indicated that he prefers to curb free trade to protect U.S. jobs, raising fears of a return to trade friction that marred U.S.-Japan relations in the 1980s.
(Reporting by Stanley White and Kaneko Kaori; Editing by Kim Coghill)