The Brookings Institution All Rights Reserved. With the collapse of Japanese stock and real estate prices in the early 1990s, very slow economic growth from 1992 to 1995, and revelations of large amounts of bad debt in the banking sector, longstanding U.S. concerns about trade with Japan seem simply to have slipped the minds of many Americans. But though Japan no longer seems an unstoppable juggernaut, it nevertheless remains one of the world's leading industrial nations.
Japan also remains a big part of U.S. trade.
In 1995, Japan was the second largest U.S. export market, taking 11 percent of all U.S. exports, and was the source of 15 percent of U.S. imports. And leading Japanese corporations are still the chief global competitors in many industries for American firms. To be sure, these individual trade problems are not linked in any major way to macroeconomic balances. Solving market access problems will not materially alter Japan's global trade surplus or the bilateral imbalance between Japan and the United States. Large declines in the value of the yen against the dollar in the past two years will result in sharp increases in Japanese trade surpluses this year and next.