Tokyo (AFP) – Japan is hurting from the Iran war ahead of Prime Minister Sanae Takaichi’s visit to Washington next week. She has promised to be “candid” with the US president. How forthright Japan’s first woman premier can afford to be in their March 19 meeting, and how receptive the 79-year-old Trump will be, remain to be seen. The world’s number-four economy is the fifth-biggest importer of oil, 95 percent of it from the Middle East, with 70 percent passing through the Strait of Hormuz, which is now effectively closed.
On top of oil rising above $100 per barrel, Japan’s hefty import bill has also increased because its currency has fallen against the dollar, making every barrel of crude—traded in the US currency—cost more yen to purchase. On Wednesday, Japan became the first country to announce a release from its strategic oil reserves, with Takaichi, 65, stating that Japan was being “severely impacted.” Trump has indicated that defeating Iran’s “evil empire” is more important than crude prices. Pricier oil—and also gas—risks making life more expensive for firms and families alike, potentially hurting Takaichi’s popularity.
Just over four weeks ago, she was basking in a landslide election victory, but polls published this week suggest that the honeymoon is souring. After rice prices doubled last year, Stefan Angrick, senior economist at Moody’s Analytics, mentioned that food prices could rise again. “You need energy to produce food. Natural gas, for example, is often used to produce fertilizer,” Angrick told AFP. Growth is already feeble—0.3 percent in the last quarter—and Takaichi pushed through a 21.3-trillion-yen ($134 billion) stimulus package last year. Any extra efforts could worry investors, who are already fretting; bond yields hit records in January due to Japan’s colossal debts.
Japan is a strong backer of the rules-based international order, but Takaichi has been careful not to criticize the war and provoke Trump after charming him during his visit to Japan in October. “We do not possess detailed information, including whether this was a measure for self-defense. Our country will refrain from making a legal assessment,” she said on March 2. Tokyo can ill afford to annoy Trump since the United States has been the guarantor of Japan’s security for decades, with 60,000 troops on Japanese soil. Trump is due to visit China from March 31 to April 2. Japan-China ties have worsened after Takaichi suggested in November that Japan might intervene militarily in any Chinese attempt to take Taiwan. Analysts have expressed concerns that Washington has taken its eye off the Asia-Pacific, as two US destroyers normally based in Japan were reported to be in the Arabian Sea last week, according to a report issued by the US Naval Institute.
Japan remembers that Afghanistan and Iraq “bogged down US resources and attention for decades,” said Yee Kuang Heng, a professor in international security at the University of Tokyo. “On the other hand, some hope that the display of US military might in Iran and also Venezuela will enhance deterrence of China,” Heng told AFP.
Probably more on Trump’s mind will be Japan’s pledge to invest $550 billion in the United States in return for lowering threatened tariffs from 25 percent to 15 percent last year. These promises remain valid even after the US Supreme Court struck down Trump’s global tariffs in February, leading him to impose a new blanket 10 percent duty on imports. Tokyo and Washington had announced before that ruling a first tranche of $36 billion for three infrastructure projects, with more announcements expected next week.
“Takaichi will need to use the personal rapport she has built with Trump since last fall to try to convince him to look past the current conflict in the Middle East and recognize the repercussions that it is having beyond the region,” said Sayuri Romei at the Indo-Pacific Program of the German Marshall Fund of the United States (GMF). “Notably, she will need to underscore Japan’s perspective on China’s multi-faceted threat: not only does Beijing pose a threat from an economic coercion point of view, but it is also a direct security threat,” Romei told AFP.
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