US President Donald Trump stated this week that he’s not assured the USA 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 is just not achieved, significantly in relation to US gross sales of rice and automobiles.
This has brought on concern amongst vehicle and digital producers in Japan, whose exports to the US gasoline the Japanese financial system.
Here’s what we all know in regards to the US-Japan commerce talks.
What did Trump say a few commerce cope with Japan?
Most of Washington’s buying and selling companions are searching for commerce offers because the July 9 deadline for the tip of a pause on reciprocal tariffs looms nearer.
Trade talks have continued between the US and Japan for a while. Japan’s chief commerce negotiator and financial 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 line with US federal knowledge. Trump is searching 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 unsure if we’re gonna make a deal, I doubt it, with Japan,” Trump informed 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 exhausting 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 is just not reached by the point the reciprocal tariff pause is lifted on July 9. A fundamental 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 automobile elements from Japan, in addition to from different nations, face a 25 p.c tariff. Aluminium and metal imports from all nations, together with Japan, face a 50 p.c tariff primarily based 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 gained’t take our RICE, and but they’ve a large 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 Companion for a few years to come back,” Trump added, with out specifying any particulars in regards to the letter.
Trump additionally claimed that Japan doesn’t purchase automobiles from the US. “We didn’t give them one automobile in 10 years,” he informed 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 sort of issues that we’d like, and subsequently 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 huge 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 informed reporters this week, Japan purchased $354.7m of rice from the US between Might 2024 and April 2025, in line with the commerce knowledge analysis group, Observatory of Financial Complexity (OEC).
Japanese rice imports from the US have in actual fact elevated for the reason that 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 Vehicle 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, nonetheless. In 2023, for instance, Japan exported automobiles price $41bn to the US whereas importing automobiles price simply $1.25bn from the US, in line 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 big voting bloc for Japanese PM Shigeru Ishiba’s Liberal Democratic Occasion.
Commerce negotiator Akazawa stated on Tuesday that Japan wouldn’t sacrifice its agriculture sector throughout commerce talks with the US.
“I’ve repeatedly acknowledged that agriculture is the muse of the nation. In negotiations with the USA, our stance stays unchanged: we is not going to interact in talks that will sacrifice the agricultural sector,” Akazawa informed a media convention.
Ishiba can be against any commerce cope with Trump which doesn’t roll again tariffs on automobiles.
“Japan is totally different from different nations as we’re the biggest investor in the USA, creating jobs,” Ishiba stated on Wednesday throughout a debate with opposition leaders. “With our fundamental focus being on funding reasonably than tariffs, we’ll proceed to guard our nationwide curiosity.”
Moreover, Japan is in a stronger place than many different nations as it’s the largest overseas holder of US debt. In keeping with current reviews, 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 financial system depend upon US exports?
Whereas Japan does maintain giant quantities of US debt, it’s extra reliant on the US for exports than the opposite method round. The US is Japan’s largest export market, accounting for 19.1 p.c of complete Japanese exports in 2023, in line with the OEC.
Solely 4.03 p.c of US exports went to Japan in 2023. In that yr, the US exported $7.7bn price of petroleum fuel to Japan.