CONFIDENTIAL
From the Secretary of State
I visited the Mass Transit Railway and the Castle Peak Power
Station, two prestige projects with Britain in the lead. We are fortunate in having first rate British chief executives in both cases, but it is clear that our companies (Metro-Cammell and GEC) won the contracts on their merits, largely through the enthusiasm of the sales teams backed up by excellent work by our officials here and in Hong Kong. I hope both projects will serve as a shop window for British industrial performance.
In Japan cars inevitably figured largely in my discussions since
I was in Tokyo on the eve of the SMMT/JAMA discussions on the future
of the industry-to-industry restraint agreement on motor vehicles. In public I emphasised that the future level of imports of
Japanese cars into the UK was a matter for the two industries to
settle, but I informed my host, Mr Sadaki, of the importance which we attached to Japan reducing its shipments in order to maintain its share of the anticipated reduced market while 3L pursued its restructuring plans. I was able to call on Honda, and in general I sensed a favourable curiosity towards the BL.Honda
deal. I repeatedly stated my belief that the future of UK/Japan economic relations rests in the exchange of technology and investment, of which the Rolls Royce jet engine collaboration project should provide a further example.
Despite the liberalisation flowing from the multilateral trade negotiations, Japan remains a difficult market to penetrate. I visited a joint venture pharmaceuticals factory established by Glaxo, but even with a Japanese partner the company faced formidable barriers to marketing their products, including the requirement that many tests on drugs have to be repeated in Japan, regardless of evidence collected for use in connection with sales elsewhere; this can delay the introduction of a drug for up to 5 years. Our exporters face an uphill struggle.
We
CONFIDENTIAL
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