BRITAIN, JAPAN CLASH OVER STOCK MARKET ACCESS
Britain and Japan clashed today over U.K.
Demands for greater access to the Tokyo Stock Exchange (TSE) as
trade tensions between the two countries mounted.
    British consumer affairs minister Michael Howard told
reporters he was dissatisfied with the exchange's response to
Britain's non-negotiable timetable for increased British
membership and warned of possible reprisals in the future.
    He described his meeting with Tokyo stock exchange (TSE)
head Michio Takeuchi, in which he demanded greater exchange
access, as "very frank indeed."
    In a separate press conference, TSE President Michio
Takeuchi said the exchange has done its utmost to liberalise
its membership and called on Britain to make some concessions.
    According to Takeuchi, Howard wants three British firms to
be named members of the Tokyo stock exchange by the end of this
year. Neither Takeuchi nor Howard would name the companies.
    "Next May is the earliest possible date for opening our
membership and I want the British government to understand
this," Takeuchi said.
    Membership cannot be increased before space on the trading
floor is expanded in May 1988, he said.
     Howard told reporters that was not good enough and said
that Britain would use its powers to ban Japanese financial
institutions from London if it was not satisfied with Tokyo.
    Japan has until the next meeting of senior officials from
the two countries in May or June to come up with a postive
response to the British timetable or face retaliation, he said.
    "The timetable was constructed in a way that made it a very
reasonable request and I expect it to be met," he said.
    Asked about the exchange's argument that it has no floor
space to expand membership, Howard replied, "We find it very
difficult in our country to understand why the considerable
ingenuity and resourcefulness of the Japanese (in world
markets) is unable to overcome problems of that kind."
    While here, Howard said he also expressed frustration with
the huge trade imbalance with Japan and with Tokyo's handling
of demands by Britain's Cable and Wireless for a greater role
in Japan's telecommunications business.
    According to Japanese newspaper reports, at least some of
that message may have penetrated.
    According to several reports, the Post and
Telecommunications Ministry is considering a Cable and Wireless
proposal for a telephone cable between Japan and the U.S.
    Ministry officials were unavailable for comment.
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