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Japanese Business Sector Shows Signs of Recovery - 2003-09-05

Japan's business sector is showing signs of recovery, as wages fall and rice comes under the global trade spotlight.

Global trade and Japan's rice industry are coming under focus ahead of next week's high profile World Trade Organization meeting in Mexico.

The United States is pushing Japan to import more rice as part of trade liberalization. U.S. Trade Representative Robert Zoellick says the politics of the farm trade among wealthy nations is hampering global trade negotiations. He cited Japan's rice sector as an example.

So far Japan has shied away from limiting high tariffs on politically sensitive products or lifting import quotas. Rice farmers are a traditionally strong political lobbying group, long protected by the government.

Meanwhile, Japan's corporate sector shows signs of a pick-up. Capital investment by Japanese companies rose for the first time in nearly two years. It jumped 6.4 percent in the first quarter over the same period last year.

But other figures indicate that companies are still struggling with the weak Japanese economy. Japan's labor ministry says many companies, especially smaller ones, continue to cut workers' salaries.

The average monthly wage earned by Japanese employees fell about two percent in July from a year ago to $3,400, the biggest drop this year. Economists warn that falling wages will lead to lower spending in the coming months.

Toyota Motor, Japan's largest automaker, has unveiled a car that parks itself. Once the driver stops in front of a parking spot and activates the system, electronically operated sensors and automated power steering reverse the car into the space, without the driver touching the wheel. This feature will be available in the Prius model, a hybrid gasoline-electric sedan.

Toyota's President Fujio Cho says the car is the first of its kind. He adds that such fuel efficient vehicles are key to the company's future.

For now Toyota will only offer the parking assistance system in Japan where roads can be extremely narrow and parking spaces difficult to negotiate.