President Trump lands trade deal with Japan
The U.S. and Japan on Wednesday signed a limited trade deal that will eliminate tariffs and expand market access on farm, industrial and digital products. While the deal does not address the auto industry, President Trump indicated that the two nations were negotiating through a much broader agreement.
Trump and Japanese Prime Minister Shinzo Abe signed the deal on the sidelines of the U.N. General Assembly. Trump called it the “first stage of a phenomenal new trade agreement” and described it as “outlining the significant steps we’re taking toward a fair and reciprocal trade agreement.”
“This is a big chunk, but in the fairly near future we’re going to be having a lot more comprehensive deals signed with Japan,” Trump said.
“It’s a tremendous trade deal,” Trump told reporters. “It’s a very big trade deal.”
Abe said the agreement is good for both countries.
“We have successfully covered a wide range of areas, including not only the industrial goods, but also the agricultural products and also the digital trade between the two sides,” Abe said.
Trump caricature by donkeyhotey
Trump has been seeking a bilateral agreement with Japan, the world’s third largest economy, since pulling out of the Trans-Pacific Partnership trade deal after he took office.
“What we need in the future is more agreements like this all around the world,” said Zippy Duvall, president of the American Farm Bureau Federation. “What we need is trade. That’s what makes rural America grow.”
U.S. beef and pork producers have been at a disadvantage in Japan after Trump withdrew from the Trans-Pacific Partnership.
“Once implemented, the agreement signed today puts U.S. pork back on a level playing field with our competitors in Japan,” said David Herring, a hog farmer from North Carolina who leads the National Pork Producers Council.
The advocacy group Farmers for Free Trade also praised the agreement with Japan as a step in the right direction. “Our farmers need trade wins, not trade wars,” the group said in a statement. “We hope this new agreement leads to more wins, as well as progress in achieving a better trade relationship with China.”
The agreement also guarantees that digital commerce between the U.S. and Japan can flow freely without tariffs or other trade barriers.
“What we’ve really done is lock in the best possible standards you can have,” said U.S. Trade Representative Robert Lighthizer.
The U.S. Chamber of Commerce said the deal would give a lift to economies on both sides of the Pacific but cautioned that the partial agreement doesn’t go far enough.
“A comprehensive trade deal with Japan would provide some much-needed predictability—not only for the U.S. and Japan but for all our trade allies,” Myron Brilliant, the chamber’s executive vice president, said in a statement.
Benefits for Japan in the partial agreement include lower tariffs on some exports, such as machine tools, bicycles and musical instruments.
Japan wanted a commitment from the U.S. that Trump would not impose tariffs on Japanese cars, which would be a serious blow to one of the country’s major industries.
The agreement does not make any guarantee on auto tariffs, but Lighthizer did offer Japan some reassurance.
“At this point, it certainly is not our intention — the president’s intention — to do anything on autos” with respect to Japan, Lighthizer told reporters.
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