World

Bush, Mori Upbeat On Economy

By CBSNews.com staff CBSNews.com staff

March 18, 2001 / 11:24 PM EST / CBS

President George W. Bush and Japanese Prime Minister Yoshio Mori expressed confidence Monday that both nations will emerge from their economic slowdowns.

In a joint statement following a White House meeting, the two leaders pledged to work together to try to ease "the challenges facing their two economies." They also promised efforts to launch a new round of international trade talks later this year and to obtain a permanent seat for Japan on the United Nations Security Council.

The president and the prime minister met in the Oval Office for about an hour, then continued their discussions over lunch.

Mr. Bush said he is confident the U.S. economy can beat expectations. And Mori said recent steps by Japan, including dramatic new action by Japan's central bank, would help turn his nation's economy around and produce "sustainable economic growth."

"Our economies are very important to the world. The stronger we are, the more likely that there will be prosperity in other parts of the world," Mr. Bush said as he and Mori began their meeting.

CBS News Correspondent Peter Maer reports that with Mori's political future in doubt, no major agreements are likely. Mori is expected to step down as early as next month over gaffes and scandals that have sent his popularity plunging to less than 10 percent.

The Bank of Japan earlier Monday reverted to what is essentially a zero-interest-rate policy that it abandoned in August. But there were questions about how effective it would be without action from politicians and business leaders on economic reform.

Mori told reporters he looks forward to explaining the bank's action to Mr. Bush. "I'm certain that it will have a positive effect on our economy," Mori said.

Speaking through a translator, Mori also expressed hope "that the United States will take appropriate macroeconomic policies to deal with the U.S. economy, which is slowing down," Mori said. He did not elaborate.

Mr. Bush used the meeting as an opportunity to get in yet another plug for his $1.6 trillion, 10-year tax cut. "First we've got to get our own economy growing," he said.

Mr. Bush said he is confident the American economy will rebound fom its current woes. "I will explain that to him (Mori) as clearly as I can, how optimistic I am about economic growth."

Among the other topics discussed was the ongoing inquiry into the sinking of a Japanese trawler, the Ehime Maru, by an American submarine off Hawaii last month. Nine Japanese citizens died in the accident.

"Solid ties" between the United States and Japan "enable the two countries to deal with problems, such as the regrettable Ehime Maru accident," the statement said.

Mori brought up the accident and said he appreciated efforts being made by the U.S. government, including a Naval proposal for lifting the sunken vessel, said a senior administration official.

Mr. Bush promised tat the United States would do its best to resolve outstanding issues, said the official, who spoke on the condition of anonymity.

The official also said Mori brought up the issue of whether U.S. troops stationed on Okinawa should be relocated, even as he voiced support for a continued U.S. military presence in Japan.

"The president said that any relocation issues would have to be looked at in the total context of our presence in the region, and that we would fully discuss these with Japan," the official said.

Okinawa, located 1,000 miles southwest of Tokyo, is home to half of the 47,000 U.S. troops stationed in Japan. Tensions on the island have grown between U.S. military personnel and civilians.

The two leaders also discussed China and North Korea, U.S. officials said.