WASHINGTON/TOKYO: Japan is set to begin face-to-face tariff negotiations with the United States on Wednesday, one of the first countries to test Washington’s willingness to relent on sweeping duties that have roiled financial markets and stoked recession fears.
Tokyo’s top trade negotiator Ryosei Akazawa will meet U.S. Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer for wide-ranging discussions that could also address energy projects and the thorny issue of exchange rates.
While Bessent has said there is a “first mover advantage” as more than 75 countries have requested talks, Japanese Prime Minister Shigeru Ishiba has said the close U.S. ally won’t rush to reach a deal and does not plan to make big concessions.
Japan has been hit with 24% levies on its exports to the United States although these tariffs have, like most of Trump’s sweeping “reciprocal” tariffs, been paused for 90 days. But a 10% universal rate remains in place as does a 25% duty for cars, a mainstay of Japan’s export-reliant economy.
Ishiba has, for now, ruled out counter-measures.
“The difficulty for the Japanese team is that the United States has created a huge amount of leverage for itself, unilaterally,” said Kurt Tong, managing partner at The Asia Group, a Washington-based consultancy.
“The U.S. is offering to not hit Japan with sticks, and Japan is stuck in a position of offering a whole lot of carrots. And from their perspective, it feels like economic coercion,” said Tong, an ex-State Department official.
Trump tariffs may delay, but won’t derail, Japan rate hikes
Trump has long complained about the U.S. trade deficit with Japan and other countries, saying U.S. businesses have been ripped off by unfair trade practices and intentional efforts by other countries to maintain weak currencies.
Bessent met Vietnam’s deputy prime minister last week to discuss trade and has invited South Korea’s finance minister to Washington for talks next week. Italian Prime Minister Giorgia Meloni will meet Trump at the White House on Thursday to discuss tariffs imposed on the European Union.
The scope of Wednesday’s discussions remain unclear.
Bessent has said he is hoping to strike deals that would cover tariffs, non-tariff barriers and exchange rates, though Tokyo has lobbied to keep the latter separate.
Possible Japanese investment in a multi-billion dollar gas project in Alaska could also feature, Bessent has said.
Japan hopes that pledges to expand investment in the United States will help to convince the U.S. that the two countries can achieve a “win-win” situation without resorting to tariffs, Japan’s chief negotiator Akazawa said ahead of his departure.
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