After a discussion of Japanese fishing (which is the subject of a
separate report) the Secretary raised with Mr Nishi the question
of trade with Japan.

2. Mr Tange referred to the conversation which Mr Casey had had
with Mr Nishi on 19 February, in which Mr Casey had pointed out
that this was not an appropriate time to discuss contentious
matters relating to Japan. [1] Mr Tange said that the Australian
Government had been carefully examining an earlier memorandum of
the Japanese Government on trade and we would be in a position
next week to offer some comments on it, mainly of an explanatory
nature and designed to clear up some of the points of facts on
which Japan had showed an interest. Australia did not propose
however to reply at this stage to the Japanese note because we
felt that it was not yet a suitable time for our discussions to
take up matters of policy and harden into attitudes on either
side. Mr Tange said that the Department would be happy to have
talks with Mr Kakitsubo possibly in the coming week along the
lines he had suggested.

3. Mr Tange then referred to reports that Mr Kitahara of the
Economic Division of the Japanese Foreign Office was coming to
Australia and New Zealand to talk about trade. Mr Nishi said that
Mr Kitahara was really going to New Zealand and would be passing
through Australia. However, he would visit Canberra so that he
could also have some talks with Australian government officials.

Mr Kitahara was principally interested in two matters: (a)
programming by Japan to take account of the likely Australian
action to follow the recent Japanese sterling agreement with the
United Kingdom; and (b) the principles to be adopted by Australia
in carrying out licensing procedures. If Australia did not want to
have official talks, Japan would be quite agreeable to unofficial
talks. Mr Kakitsubo said that if necessary there could merely be
an informal party in his home to which some Australian officials
could come. Mr Tange said that he did not think that would be wise
or acceptable. The best thing would be for Mr Kitahara not to pass
through Australia at all; if he did come to Australia it would be
best for him not to come to Canberra but to stay in Sydney. The
Japanese might well find that some of the points Mr Kitahara was
interested in would be covered by the official talks here with the
Japanese embassy which were referred to above (para. 1). Mr Nishi
replied that in any case Mr Kitahara had to come to Canberra to
see the Japanese Embassy and that Australia could not prevent
that. He (Mr Nishi) would be prepared to issue a statement saying
that Mr Kitahara had come to Australia solely to see the Embassy
and that he would not be having any talks with Australian
Government officials. Mr Nishi undertook to advise Mr Kitahara to
make a statement along those lines if the press raised the purpose
of his visit.