WASHINGTON: US President Donald Trump on Tuesday (Jul 22) announced a trade deal with Japan that he said will result in Japan investing US$550 billion into the United States and paying a 15 per cent reciprocal tariff.
Trump had earlier this month said that the US would impose 25 per cent tariffs on Japan from Aug 1.
Japanese Prime Minister Shigeru Ishiba said Wednesday that he needed to examine the details of the trade deal before commenting.
“As for what to make of the outcome of the negotiations, I am not able to discuss it until after we carefully examine the details of the negotiations and the agreement,” Ishiba told reporters in Tokyo after Trump’s announcement.
“As the government, we think that (the deal) will protect national interests,” he told reporters.
In a post on Truth Social, Trump said that Japan will open to trade for cars, trucks, rice and certain agricultural products, among other items.
“We just completed a massive deal with Japan, perhaps the largest deal ever made,” he said.
“Japan will invest, at my direction, US$550 billion dollars into the United States, which will receive 90 per cent of the profits,” Trump added.
“This deal will create hundreds of thousands of jobs – There has never been anything like it,” he said.
“This is a very exciting time for the United States of America, and especially for the fact that we will continue to always have a great relationship with the country of Japan.”
The two countries have agreed to reduce additional tariffs on Japanese automobiles to 12.5 per cent from the earlier planned 25 per cent, bringing the total to 15 per cent, including the original 2.5 per cent rate, Japanese public broadcaster NHK said on Wednesday, citing government sources.
Japanese auto stocks surged after Trump’s announcement, with the overall Nikkei 225 index of stocks gaining more than 1 per cent.
Toyota shares were up almost 10 per cent, Nissan by 6.5 per cent and Honda 8.15 per cent.