Washington (AFP) – President Donald Trump said Tuesday that the United States had agreed to a “massive” trade deal with Japan that would include a 15 percent tariff on its exports. The two countries have been locked in negotiations for months since Trump launched his global trade offensive, with levies targeting steel and automobiles — both important Japanese exports — seen as particular sticking points. Trump had previously threatened Japan, a major US trading partner, with a tariff of 25 percent beginning August 1 if a deal was not reached.
“We just completed a massive Deal with Japan, perhaps the largest Deal ever made,” Trump announced on his Truth Social platform. He said that under the deal, “Japan will invest, at my direction, $550 Billion Dollars into the United States, which will receive 90% of the Profits.” He did not provide further details on the unusual investment plan, but claimed the deal “will create Hundreds of Thousands of Jobs.”
Japanese Prime Minister Shigeru Ishiba said that he needed to examine the deal before commenting. “As for what to make of the outcome of the negotiations, I am not able to discuss it until after we carefully examine the details of the negotiations and the agreement,” Ishiba told reporters in Tokyo after Trump’s announcement in Washington.
Japan has agreed to “open their Country to Trade including Cars and Trucks, Rice and certain other Agricultural Products, and other things,” Trump said. Rice imports are a sensitive issue in Japan, and Ishiba’s government had previously ruled out any concessions on the topic. Japan’s Nikkei index bounced over one percent on news of the deal, with Japanese auto stocks rising six percent.
The deal comes after Ishiba faced a bruising weekend election that left his coalition without a majority in the upper house. Trump has been under pressure to wrap up trade pacts after promising a flurry of deals ahead of his August 1 tariff deadline. Earlier on Tuesday, he announced a deal had been reached with the Philippines, which would see the country face 19 percent tariffs on its exports.
The White House also laid out details of a deal with Indonesia, which would see it ease critical mineral export restrictions and also face a 19 percent tariff. Similar agreements have been struck with the United Kingdom and Vietnam, while negotiations are ongoing with the top three largest US trading partners, China, Canada, and Mexico. After an escalatory tit-for-tat with Beijing, the two major economies agreed to a temporary lowering of tariffs, with another round of negotiations expected next week in Stockholm.
Since returning to the White House in January, Trump has imposed a sweeping 10 percent tariff on allies and competitors alike, alongside steeper levels on steel, aluminum, and autos. Legal challenges to Trump’s non-sectoral tariffs are ongoing.
© 2024 AFP
