President Bush on Thursday hailed a trade reform agreement with Japan as ``an important framework'' for reducing the $49 billion U.S. trade deficit with Tokyo. The president said he welcomed the joint report Thursday by U.S. and Japanese negotiators in Tokyo. In it the two countries identified internal economic practices that hinder open trade, took corrective actions, and ``made commitments to take further steps to resolve a wide range of structural problems,'' Bush said in a written statement. ``We expect that the structural policy actions to be taken will have a positive effect on our economies, encouraging open and competitive markets, promoting sustained world economic growth, contributing to a reduction in global payments imbalance, and enhancing the quality of life in both Japan and the United States,'' he said. Further, the president said in the statement, the U.S.-Japan agreement will benefit ``the entire world.'' Bush was expected to discuss the matter further on Saturday when he meets with Japanese Prime Minister Toshiki Kaifu in Houston where both are attending the economic summit of industrialized nations. The agreement Thursday emerged from a series of complex negotiations called the Structural Impediments Initiative, or SII, involving the removal of barriers to open trading. The joint report in Tokyo followed Bush's acknowledgment this week that new taxes may be needed to reduce the U.S. federal deficit, a key factor in getting the agreement, officials said. The announcement that the president would consider such taxes was followed by a Japanese compromise Wednesday to increase planned public works spending. That might help reduce the trade imbalance by increasing sales of U.S. products and construction services in Japan and soaking up some excess Japanese savings and investment funds. ``As Japan tackles its structural problems,'' Bush said in his statement, ``so must the United States.'' The president said he wants to work closely with Congress in the ongoing budget negotiations to strengthen public and private savings and lower the deficit. ``Both our governments recognize that further effort will be necessary in order to address fully these structural problems and to maintain the momentum of our adjustment efforts,'' Bush said. Bush lauded Kaifu for his personal efforts in fashioning the agreement and for ``strong and courageous political leadership.''
