Dynamic commercial and technological forces are deepening worldwide economic integration a

nd interdependence, bringing us closer together than at any other time in human history. Glohalization presented great opportunities, combining resources from various economies in new and innovative ways that will help us all grow faster, be more productive and create more jobs. It also poses formidable challenges as traditional business and social structures come under pressure to adapt to a rap idly changing environment.

As the world' s two largest economies, the U. S. and Japan have a special responsibility to help this vast transformation. Our security alliance undergirds the stability that has made possible an era of unprecedented prosperity in the Asia-Pacific region. We are working hard to keep that security partnership vital and strong. Economically, our two countries have joined hands to facilitate the free flow of goods, services and capital across the region and the world. Bilaterally, we have resolved many serious trade disputes and are committed to resolving new problems that arise. Multilaterally, we are cooperating to strengthen the global trading system and to promote trade and investment liberalization through the activities of APEC and the WTO.

American and Japanese businesses are joining forces in a wide range of sectors, bringing their respective strengths to a number of successful joint ventures. They give concrete meaning to the concept of win-win outcomes in trans-Pacific relations. For example, Texas Instruments has joined with Hitachi, and Motorola with Toshiba, to make semiconductors in Japan; GF and Yokogawa together produce and sell medical equipment; Time-Wagner and U.S. West are partnering with Japanese firms to offer cable telephone services; Hughes and its Japanese partners are bringing multi-channel TV to Japan; and Microsoft has ventures with a host of Japanese companies. I commend these and the many. Many more American and Japanese companies that are using their talents to create jobs, meet consumer needs and contribute to the continued economic growth of our two countries, the Pacific region and the world as a whole.

Our job in government is to continue to support policies that promote macroeconomic stability, as well as vigorous trade and investment. We must also respond to new demands on trade diplomacy which are just a few of the problems emerging, Infrastructure bottlenecks likewise pose a serious threat to growth. We need to look beyond traditional trade policy and at the bigger economic picture. A comprehensive attack on the full array of barriers to free trade and growth must be our continuing policy concern.

As we lead the transformation into the 21st century, the U. S. and Japan will confront common challenges at home. Such as reforming industrial structures and providing for aging populations. Dealing with these changes will not keep us from the enormous tasks abroad: integrating the economies in transition within the global fold, establishing regimes for sustainable growth that protect our environment, engendering a culture of trust in a world that spent much of this century deeply divided by ideology, and convincing rogue nations that the negotiating table is the only acceptable means of settling disputes. Through U. S. -Japan cooperation we can achieve our shared global objectives and better guarantee a prosperous future of peace and opportunity for us all.

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