Remarks Prior to Discussions With Prime Minister Yoshiro Mori of Japan and an Exchange With Reporters

President Bush. It's my honor to welcome the Prime Minister of our close friend to the Oval Office. Mr. Prime Minister, welcome.

This meeting is an important meeting because it gives us both a chance to confirm the importance of our relationship. We view Japan as a very strong friend and ally, and that's the way it's going to be during my administration. And we've got such a good friendship and such a strong alliance that we're able to overcome occasional problems that might arise. We can do so in the spirit of friendship.

So I'm honored that the Prime Minister is here. We're going to have a—we'll discuss a lot of issues: We'll discuss our economies; we'll discuss trade; we'll discuss our alliance and how best to work together to keep the peace. I'm looking forward to a very fruitful and important discussion.

Mr. Prime Minister.

Prime Minister Mori. I have spoken to President Bush over the phone three times, but I am delighted today that I am able to have a face-to-face meeting with the President. In today's meeting, as the President just said, I would like to reaffirm the strong alliance between Japan and the United States and would like to discuss a very—a broad range of issues, including various issues in international affairs, and would like to set out the fundamental direction in which the Japan-U.S. alliance should head in the 21st century.

I would like to explain the various measures which our Government has taken so that the Japanese economy will have a fully sustainable economic growth. And I'd like to express my strong determination to pursue necessary policies for that. I'd also like to express to the President my hope that United States will take appropriate macroeconomic policies to deal with the U.S. economy that is slowing down.

Bank of Japan's Zero-Interest-Rate Policy

[At this point, a question was asked in Japanese, and a translation was not provided.]

Prime Minister Mori. I, of course, will be explaining to the President the decision made by the Bank of Japan yesterday, and I sincerely hope that it will have—and I am certain that it will have a positive effect on our economy.

U.S. and Japanese Economies

Q. Mr. President, with both the Japanese and the American economies in such fragile states, could you explain how you see the interrelationship between the economies and what you'd like to see the Japanese Government do to address its problems and particularly in the financial sector?

President Bush. First, we've got to get our own economy growing the way I know it can. That's why I'm advocating tax relief and free trade regulatory relief. And I look forward to explaining to the Prime Minister that we do have a plan to give our economy a second wind. I'm very confident about our economy. I know it can beat expectations. I will explain that to him, as clearly as I can, about when our policies are in place, how optimistic I am about economic growth.

And secondly, I look forward to hearing Japan's view of reform, internal reform. I'm confident that's going to be a large part of our discussions today.

The interrelationship between our two economies is important. When you combine our economies, we represent about 40 percent of the gross domestic products of all the nations added up. And that's a very important—and therefore, our economies are very important to the world. And the stronger we are, the more likely it is there will be prosperity in other parts of the world. And so this is going to be a very important part of our discussion.