Japan Would Retaliate With Cargo Flight Ban : Trade: Tokyo says it will take the action against FedEx and Northwest if Washington proceeds with air route sanctions.

TOKYO — Adding fire to a battle over aviation rights, a Transport Ministry official said Japan will ban cargo flights by Federal Express Corp. and Northwest Airlines Inc. between Japan and other points in Asia if the U.S. government imposes sanctions against Japanese carriers in a dispute over air routes.

If Washington limits cargo flights from Asia to the United States, Japan will institute the sanctions against the U.S. carriers, said the official, who spoke on condition of anonymity.

Washington said Monday that it will not let Japan Airlines or Nippon Cargo Lines carry cargo from one or more of five Asian points--Hong Kong, Taiwan, Indonesia, Singapore and Thailand--to the United States, unless Japan honors requests from U.S. carriers to expand their routes that permit them to land in Japan on their way to other Asian destinations.

The Japanese official said Japan will fight back by barring Northwest and Federal Express from picking up or unloading cargo in Japan en route to or from several Asian cities. Those include Singapore; Taipei, Taiwan; Seoul; Bangkok, Thailand; the island of Penang in Malaysia, and Manila.

Tensions over aviation rights have flared as the two sides near a showdown over trade in autos and auto parts. Washington has threatened $5.9 billion in punitive tariffs on luxury autos if Japan does not agree by June 28 to further open its market to imports.

Japanese auto companies said Tuesday that they will increase production in North America, which analysts said is an effort to forestall the tariffs.

Japan and the United States have been arguing for more than a year over aviation rights. Japan says a treaty signed in 1952 unfairly favors U.S. carriers.

The current spat broke out because Tokyo has refused to honor a request from Federal Express to extend flights from Japan to a new facility in the Philippines.

Each week, 156 U.S. flights stop in Japan on the way to other points in Asia, but only two Japanese flights stop in the United States and go on to other countries, the Japanese official said.

If the dispute is not resolved, U.S. and Japanese sanctions will probably take effect by the end of the month, he said.

Transport Minister Shizuka Kamei said Wednesday that he “deeply deplored” the proposed sanctions and will send a senior envoy to the United States on July 3 for more talks. Meetings last week ended without resolution.