Japan Takes the Quiet Approach at Summit : APEC: The region’s economic powerhouse remains inconspicuous because of politics and politeness.

SEATTLE — Call it the Invisible Giant.

If you drew a map of Asia depicting nations according to the relative size of their economies instead of their landmasses, Japan would look like a huge continent while the rest of the region, China included, would appear as little more than a series of small islands.

But here amid the swirl of diplomatic activity surrounding the discussions of the Asia-Pacific region’s economic future, Japan--for all its economic might--has done its best to be as inconspicuous as possible.

Tokyo’s leaders may have remained quiet to avoid offending their Asian allies, who have a variety of reasons for worrying about Japan both now and in the future. Japan is also embroiled in sensitive political problems at home that it doesn’t want to inflame.

But Japan’s determination to lie low, and President Clinton’s reluctance to press Japan, left a gaping hole in meetings here last week. In their pursuit of a harmonious Pacific community, the leaders of the Asia-Pacific Economic Cooperation forum failed to confront the single most important long-term challenge that faces them all: how to resolve the massive trade disequilibrium in the region caused by America’s continual trade deficits with Asia and Japan’s corresponding trade surplus with most of the world.

Clinton did express vague optimism over resolving the Japan problem. “I’ll make you a prediction on the economic issues,” he told a group of journalists after his meeting with 13 Asia-Pacific leaders on Blake Island.

“By next June or July--certainly by a year from now, I believe that the responsibilities of the United States and Japan to do more to promote global economic growth will have been, in large measure, advanced.”

Japanese Prime Minister Morihiro Hosokawa’s eyes shifted as Clinton made the statement, but his expression remained unchanged. And Hosokawa said nothing during his stay here to justify such optimism.

Asked at a press conference later about Clinton’s comment, Hosokawa acted confused: “I don’t know what he is talking about.”

Japan’s delegation distributed to the press English-language copies of Hosokawa’s autobiography, “The Time to Act Is Now.” But when asked in public what he would do to open Japan’s markets in such areas as rice, Hosokawa indicated that he wasn’t about to act now because of the need to pass legislation at home to reform the electoral system.

“One has to be very careful in not getting this rice issue in the way of political reform,” said Hosokawa, sitting across from Clinton after a fireside chat.

Hosokawa made it clear that he believes the United States shares the blame for its inability to sell in Japan and that there are limits to how much Japan can do to correct the imbalance. “It can’t be a one-way street and must be within the abilities of the government. And (numerical) targets are not desirable,” Hosokawa said.

Japan seemed determined to stay out of the news. Its occasional press briefings were by low-level officials who responded vaguely to questions and did little to clarify Japan’s role at the meeting. With the exception of a short news conference Saturday, neither Hosokawa nor Japan’s senior delegates made themselves available to illuminate the issues on the APEC table.

The Clinton Administration, for its part, went out of its way to avoid making critical comments about Japan. The silence was in sharp contrast to very public U.S. criticism of China for failing to do more on human rights.

“It would have been biting off too much to seek concessions from Japan,” U.S. Trade Representative Mickey Kantor told a group of reporters over breakfast Saturday. “That would not have been appropriate or smart.”

Kantor said the United States wanted to be careful not to undercut Hosokawa’s domestic reform efforts. “You don’t want to diminish his stature,” Kantor said, though he indicated that Japan would be held to targets on a range of bilateral trade issues.

But the Administration has already postponed some of those targets, and Clinton officials sent no messages that failure to meet future targets would bring retaliation.

Japan has remained obdurate on most of America’s requests. Japanese officials have made it clear that if their government does enact a tax cut, as the Clinton Administration has requested, it would be accompanied by a corresponding hike in sales taxes. Such action would undermine the ability of the tax cut to boost the Japanese economy--a step Washington sees as necessary to opening up opportunities for U.S. firms. Similarly, Japan has refused to go along with American demands that Japan reach targets for cutting its trade surplus.

As if to remind delegates here that the problem won’t go away, the Department of Commerce announced Friday that America’s trade deficit is running at an annual rate of $117 billion, substantially higher than last year’s $84 billion. Close to half that deficit was with Japan.

Japan has good economic reasons for its silence. A more active Japanese role could fuel Asian worries that Japan would dominate the Pacific community now being sought by Washington.