A Padlock On The Paddock Gate

Flash points in the U.S.-Japan trade war: automobiles, semiconductors, racehorses. Racehorses?

Just look at the numbers. The betting handle at Japan's 10 central and 30 regional tracks totaled $35.3 billion last year, a sevenfold increase in five years and nearly $25 billion higher than in the U.S. Attendance has surged 31%, to 26.8 million, over the same period. Japan offers fat purses, including several first-place prizes of more than $1 million. In short, horse fever is sweeping Japan, just when the horse-race business elsewhere has thrown a shoe.

Those are the numbers American racehorse breeders love. But here are a few that they hate: Only 114 of Japan's 6,000 registered Thoroughbreds are foreign-born. Just two annual races, the Japan Cup and the Fuji Stakes, allow foreign horses that have raced before. And just 35% of the 6,000 races held by the Japan Racing Assn. (JRA) allow foreign-born horses at all, even if they're trained in Japan. The regional circuit of 26,000 races is even stricter.

LATHERED UP. Washington is getting into a lather about the restrictions. At the urging of legislators led by Senator Mitch McConnell (R-Ky.), U.S. Trade Representative Carla A. Hills has been pressing Tokyo to lower barriers against imported racehorses. "The bottom line," says a U.S. official involved in the talks, "is the (U.S.) Thoroughbred industry is in the doldrums, and we're looking for a new source of demand for our horses."

The JRA's response to this trade dispute sounds familiar: It has drawn up a five-year plan to allow foreign-born horses to run in 65% of JRA-sanctioned races by 1996 and to open 15 more events to foreign owners. "We can see it's not fair," says Yoshitaka Kitahara, general manager of racing at the JRA. "But if we open all at once, the domestic industry would collapse."

Japanese owners do not seem to share those worries. They would love to buy U.S. horses, especially Kentucky-breds - most of which have bloodlines superior to anything bred in Japan. But Japanese breeders are resisting mightlily. Four months of talks between the JRA, breeders, and owners have gone nowhere. Genichi Ikemoto, executive director of the Japan Bloodhorse Breeders' Assn., fears that the plan as it stands would force 20% of its 2,400 members into bankruptcy. "We're fighting for survival," he says.

MORE SUBSIDIES? Ikemoto is demanding a high price for loosening restrictions. Roughly 6% of a winning horse's prize money is awarded to its breeder. Ikemoto would like that doubled. He also wants more subsidies from the JRA. The breeders and the JRA have to reach some form of agreement before drawing up the 1993 racing schedule.

No matter what sort of accord emerges, Japanese racing will remain tightly controlled. Owners still will have to pay a $32,000 customs duty on imported Thoroughbreds. That will remain the biggest barrier to U.S. breeders, who are struggling through a prolonged slump at home that has driven down stud fees and auction prices.

The situation is especially frustrating to the U.S. industry because there's a new breed of Japanese bettor all ready to be educated in the virtues of American-pedigreed horses. Thanks to concerted efforts to turn horse racing into high fashion, young women are flocking to Japan's tracks. At a recent running of the Twinkle Races, the evening card at Tokyo's Ohi racetrack, high heels clicked among losing tickets, cigarette butts, and styrofoam ramen bowls. In the seventh race, Shimano World took the lead in the stretch and three well-dressed young women leaning on the rail started to jump, wave, and snap photos. "Great!" shouted one, unbothered that she backed the wrong horse.

"Let's bet again."

At this rate, though, it will be years before those fledgling fans know what they're missing.

                       JAPANESE HORSE RACING AT A GLANCE
                          Japan                      North America
      TRACKS              40                          98
      1991 BETTING        35.3 billion (dollars)      10.7 billion (dollars)
      1991 ATTENDANCE     26,8 million (dollars)      54.5 million (dollars)
      HORSES              32,000                      86,934
      TRAINERS             1,132                       2,700
      JOCKEYS                877                       4,300
      BREEDERS             2,400                      25,000
      RACES               26,400                      70,997
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