US-Japan Trade Agreement at Risk Without Action on Auto Tariffs
Japanese Prime Minister Shigeru Ishiba says the real test of last month’s US-Japan trade agreement will be in its execution, warning that lowering American tariffs on Japanese cars must be the top priority.
Speaking in parliament on Monday, Ishiba called the deal a “win-win” but admitted that implementing its terms could prove more difficult than negotiating them. “We must focus on getting the presidential order for lower automobile tariffs,” he said, noting that the sector is vital to Japan’s economy, accounting for roughly 10% of output.
The pact, reached just after Ishiba’s ruling coalition lost its upper house majority, reduced planned US tariffs on Japanese imports to 15%, down from the threatened 25%. However, Washington has yet to implement the agreed cut on car duties, which currently sit at 27.5%.
Japan’s chief trade negotiator, Ryosei Akazawa, also acknowledged concerns about the lack of a written agreement, saying similar deals between Washington and other countries have also been handled without formal documentation.
The agreement includes a $550 billion US investment plan, but Ishiba stressed that spending decisions will rest with the private sector. He also pointed to potential cooperation with the US in sectors like shipbuilding, possibly alongside South Korea.
Recent polling shows Ishiba’s cabinet approval ticking up to 36.8%, though his Liberal Democratic Party’s support slipped slightly to 20.4%. The right-wing Sanseito party gained ground, becoming the second most popular party at 10.2%.
Despite political headwinds and no majority in either house of parliament, Ishiba vowed to see the trade deal through, saying his administration’s responsibility is to “follow through and bring these issues to resolution.” He offered no comment on when he might step down.
Source: Bloomberg
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Alexander Zdravkov is a market analyst and crypto journalist with interests in economics, broader financial markets and digital assets. His journey into crypto began more than four years ago, driven by a fascination with the rapid evolution of blockchain technology and the transformative potential of decentralized finance. He began analyzing market cycles and identifying emerging trends before they reach the mainstream. He holds a degree in International Relations - a background that helped shape his broader perspective on global economics, geopolitics, and the interconnected nature of modern financial markets. Whether covering the latest developments in the crypto sector or exploring broader macroeconomic themes, Alexander focuses on giving readers context rather than simply repeating headlines. During his career, he has authored more than 10,000 articles covering cryptocurrencies, traditional finance, and global market developments. His work spans everything from Bitcoin and altcoins to macroeconomic trends influencing risk assets worldwide.
