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US President Donald Trump stated this week that he’s not assured the US will attain a commerce cope with Japan forward of subsequent week’s deadline to reinstate world tariffs he paused three months in the past.
Trump additionally threatened to impose tariffs of 30 p.c to 35 p.c on Japan if a commerce deal isn’t achieved, significantly in relation to US gross sales of rice and automobiles.
This has triggered concern amongst car and digital producers in Japan, whose exports to the US gas the Japanese economic system.
Here’s what we all know concerning the US-Japan commerce talks.
What did Trump say a few commerce cope with Japan?
Most of Washington’s buying and selling companions are looking for commerce offers because the July 9 deadline for the tip of a pause on reciprocal tariffs looms nearer.
Commerce talks have continued between the US and Japan for a while. Japan’s chief commerce negotiator and economic system minister, Ryosei Akazawa, is making preparations for his eighth go to to the US as early as this weekend, Japanese broadcaster TV Asahi reported on Wednesday.
The US had a $69.4bn buying and selling deficit with Japan in 2024, in keeping with US federal knowledge. Trump is looking for to shut this. However this week, he voiced doubts about whether or not Washington and Tokyo may attain a commerce deal in any respect.
“We’ve handled Japan. I’m undecided if we’re gonna make a deal, I doubt it, with Japan,” Trump advised reporters on board Air Pressure One on Tuesday.
“They and others are so spoiled from having ripped us off for 30, 40 years that it’s actually laborious for them to make a deal.”
Why has Trump threatened Japan with new tariffs?
Trump threatened to impose a tariff of “30 p.c or 35 p.c” on Japan if a commerce deal isn’t reached by the point the reciprocal tariff pause is lifted on July 9. A primary 10 p.c tariff on items imported to the US, together with from Japan, has remained in place all through this pause.
On April 2, when Trump introduced his “Liberation Day” reciprocal tariffs, he unveiled a 24 p.c tariff for Japan on most items besides automobiles, aluminium and metal.
Trump says he doesn’t plan to increase the pause for larger, reciprocal tariffs.
As soon as they’re again in place, automobiles and automotive elements from Japan, in addition to from different international locations, face a 25 p.c tariff. Aluminium and metal imports from all international locations, together with Japan, face a 50 p.c tariff based mostly on an order Trump signed on June 4.
Now, Trump is zeroing in on rice gross sales to Japan as properly, alleging that Japan doesn’t purchase rice from the US. “I’ve nice respect for Japan, they received’t take our RICE, and but they’ve an enormous rice scarcity,” he wrote on his Fact Social platform on Monday. “We’ll simply be sending them a letter, and we love having them as a Buying and selling Associate for a few years to come back,” Trump added, with out specifying any particulars concerning the letter.
Trump additionally claimed that Japan doesn’t purchase automobiles from the US. “We didn’t give them one automotive in 10 years,” he advised reporters on Air Pressure One this week. Throughout a Fox Information interview that aired on June 29, Trump additionally stated that Japan doesn’t purchase American automobiles and added: “It’s not honest.”
“So what I’m going to do is I’ll write them a letter, say, ‘We thanks very a lot. We all know you may’t do the type of issues that we want, and due to this fact you’ll pay a 30 p.c, 35 p.c or regardless of the numbers that we decide,” Trump stated this week. “As a result of we even have a really large commerce deficit with Japan, as you recognize, and it’s very unfair to the American individuals.”
Does Japan purchase automobiles and rice from the US?
Sure. Opposite to what Trump advised reporters this week, Japan purchased $354.7m of rice from the US between Might 2024 and April 2025, in keeping with the commerce knowledge analysis group, Observatory of Financial Complexity (OEC).
Japanese rice imports from the US have in reality elevated because the worth of regionally grown rice has surged. An excessive heatwave in 2023 yielded a substandard rice crop, resulting in producers and producers stockpiling rice that was out there by early 2024.
Moreover, an earthquake hit southern Japan on August 8, 2024, which led to customers stockpiling rice and triggering a rice scarcity. The federal government has determined to launch rice from its personal emergency stockpile.
Figures from the Japan Car Importers Affiliation additionally present that Japan imported 14,724 US passenger automobiles price $1.04bn in 2024.
It is a far cry from gross sales of Japanese automobiles to the US, nevertheless. In 2023, for instance, Japan exported automobiles price $41bn to the US whereas importing automobiles price simply $1.25bn from the US, in keeping with the OEC.
Why else have commerce talks between Japan and the US stalled?
The Japanese authorities additionally faces home pressures with a nationwide higher home election on June 20. The farm sector has historically been a major voting bloc for Japanese PM Shigeru Ishiba’s Liberal Democratic Get together.
Commerce negotiator Akazawa stated on Tuesday that Japan wouldn’t sacrifice its agriculture sector throughout commerce talks with the US.
“I’ve repeatedly said that agriculture is the inspiration of the nation. In negotiations with the US, our stance stays unchanged: we is not going to have interaction in talks that may sacrifice the agricultural sector,” Akazawa advised a media convention.
Ishiba can also be against any commerce cope with Trump which doesn’t roll again tariffs on automobiles.
“Japan is completely different from different international locations as we’re the most important investor in the US, creating jobs,” Ishiba stated on Wednesday throughout a debate with opposition leaders. “With our primary focus being on funding somewhat than tariffs, we’ll proceed to guard our nationwide curiosity.”
Moreover, Japan is in a stronger place than many different international locations as it’s the largest international holder of US debt. Based on latest studies, Japan holds greater than $1 trillion in US Treasury securities, which can give it leverage in commerce talks.
Has Japan responded to Trump’s menace of upper tariffs?
Japan has thus far declined to touch upon this.
Throughout a information convention in Tokyo on Wednesday, Japan’s Deputy Chief Cupboard Secretary Kazuhiko Aoki stated: “We’re conscious of what President Trump stated, however we don’t touch upon each comment made by US authorities officers.”
How a lot does Japan’s economic system rely upon US exports?
Whereas Japan does maintain giant quantities of US debt, it’s extra reliant on the US for exports than the opposite approach round. The US is Japan’s largest export market, accounting for 19.1 p.c of complete Japanese exports in 2023, in keeping with the OEC.
Solely 4.03 p.c of US exports went to Japan in 2023. In that 12 months, the US exported $7.7bn price of petroleum fuel to Japan.
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