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Yomiuri Shimbun
7 days ago
- Business
- Yomiuri Shimbun
Intensive Diet Deliberation on Tariffs: Details of Japan-U.S. Agreement Too Ambiguous
Japan and the United States reportedly agreed on reducing the U.S. tariff rate on Japanese automobiles to 15%, but no implementation date has been set. The question of whether to revise the Japan-U.S. trade agreement, which sets the tariff rates between the two countries, also remains unresolved. Under such circumstances, can it be said that the tariff negotiations have concluded? One cannot help but feel concern over the government's vague explanation. Intensive deliberation on Japan-U.S. tariff negotiations was held at the House of Representatives Budget Committee. Constitutional Democratic Party of Japan leader Yoshihiko Noda said the fact that a written agreement between Japan and the United States was not produced has led to discrepancies in their positions. 'The negative impact of not having a document is significant,' he said. Democratic Party for the People leader Yuichiro Tamaki also emphasized that unless Japan clarifies its understanding of the tariff agreement, the United States will interpret it in a way that is advantageous for itself — a situation that is disadvantageous for Japan. Prime Minister Shigeru Ishiba said, 'We were afraid that creating a document would delay the lowering of tariffs,' emphasizing that it was necessary to prioritize the agreement, even if it was only verbal. The Japanese and U.S. positions on tariff negotiations are marked by discrepancies. U.S. President Donald Trump signed an executive order imposing tariffs on various countries. However, the text of the order did not include the agreement with Japan to reduce tariffs on automobile imports. Regarding Japanese investment in the United States, the U.S. side explained that Japan will invest $550 billion (¥80 trillion), and the United States will retain 90% of the profits from the investment. Japan has explained that the ¥80 trillion is merely a target amount for public and private investment, and that the 90% of profits going to the United States refers to projects funded by Japanese government-affiliated financial institutions, which account for only 1% to 2% of the total. Japan and the United States last concluded a trade agreement in 2020. It is unacceptable to nullify an agreement that is an international commitment through an executive order that applies only within the United States. If new tariff measures are to be implemented, it would only be proper to revise the 2020 agreement. If the current situation is left unaddressed, the rule of law will be undermined from its very foundation. Japan should persistently emphasize the importance of free trade and the fact that tariff measures will be detrimental to the United States. During the intensive deliberation, there were also calls for Japan to play an active role in revitalizing the free trade system. It is important to deepen cooperation with the European Union and other parties interested in joining the Trans-Pacific Partnership agreement. The upcoming Tokyo International Conference on African Development, to be held in Japan later this month, could be utilized as an opportunity to call for cooperation with African countries as well. (From The Yomiuri Shimbun, Aug. 5, 2025)
GMA Network
26-07-2025
- Business
- GMA Network
Salceda optimistic about PH entering into FTA with US
Economist Joey Salceda on Saturday expressed optimism that the Philippines will enter into a free trade agreement with the United States following President Ferdinand Marcos Jr.'s White House meeting with US President Donald Trump earlier this week. Salceda made the statement after Marcos negotiated a zero tariff plan for some American goods entering the country in exchange for a lower tariff rate for Philippine exports to the US. 'When Marcos said we are offering you zero tariffs, that is an invitation we can do an FTA,' Salceda said at a news forum in Quezon City. The economist added that now that Trump is more open to bilateral trade talks instead of forming multilateral partnerships, 'it is no longer that impossible that we can work out a free trade agreement.' The former lawmaker recalled that the Philippines was not able to join the Obama administration-backed Trans-Pacific Partnership (TPP) since there was a requirement to allow foreign ownership of land, which the Philippine Constitution prohibits. 'So when Marcos said, 'We are offering them zero [tariffs],' he was trying to [persuade] the US administration into a Free Trade Agreement,' Salceda said. Early morning on Wednesday (Philippine time), Trump announced a new 19% tariff rate for Philippine goods entering America. This is lower than the 20% announced in a letter earlier this month but higher than the 17% rate announced last April on what the US president referred to as Liberation Day. The US chief executive initially said the Philippines is going "open market" with the United States with zero tariffs, while the Philippines would pay a 19% tariff. Marcos, however, has since clarified that the zero tariffs on US products would only apply to certain markets, such as automobiles. The President also committed to increasing imports of soy, wheat, and pharmaceuticals from the US. Special Assistant to the President for Investment and Economic Affairs of the Philippines Frederick Go bared that American agri-fisheries commodities, considered 'sensitive' for the local sector, entering the country are not included in the zero tariff scheme offered to the US. Salceda, meanwhile, explained that only 31% of Philippine exports are subject to Trump's 19% tariff, while the rest—such as electronics, wood, metals, fuels, and chemicals—are covered by multiple trade agreements for exemptions. For Salceda, the effective rate was actually 6.3%, in favor of the Philippines. The lawmaker said the Philippines will benefit mostly from an FTA with the US, as it would result in cheaper products and an increase in investments from American firms. 'Definitely, from tariff savings alone there will be higher consumer welfare aside from the creation of jobs from new investments in manufacturing,' he said. Data from the US Trade Representative showed America's goods trade with the Philippines totaled $23.5 billion in 2024. Broken down, the US goods exports to Manila stood at $9.3 billion, while its imports amounted to $14.2 billion, resulting in a trade-in-goods deficit with the Philippines of $4.9 billion in 2024, up 21.8% year-on-year. Meanwhile, data from the Philippine Statistics Authority (PSA) showed the US was the country's top export destination in 2024, accounting for 16.6% or $12.14 billion of the total export receipts of $73.27 billion. — VBL, GMA Integrated News
Sydney Morning Herald
24-07-2025
- Business
- Sydney Morning Herald
Lost in translation: Trump doesn't seem to understand the ‘massive' deal he just made
The other big 'win' for the US was, Trump claims, the opening of its agricultural markets to US exports, particularly the market for rice, which has historically been extremely politically sensitive in Japan. According to the Office of the US Trade Representative, American farmers will have the same advantage as countries within the Trans-Pacific Trade Partnership in selling into the Japanese market. During the Obama administration, America was going to be a party to the Trans-Pacific Partnership, a free trade agreement whose members include Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam. It was Trump, within days of taking office in his first in January 2017, who withdrew the US from the TPP. America's farmers could have had the same trade terms with Japan as those countries eight years ago, if not for Trump. As for rice, Japan already imports up to 770,000 tonnes a year (the amount is capped to protect its own rice farmers), with the US supplying about 45 per cent of that volume. Yes, the US may be able to sell more and perhaps displace other suppliers, but Japan has reserved the right to decide the additional volume and quality of any extra imports from the US. Loading The bottom line for the trade elements of the deal is that it does lift the tariff rate on Japan's exports to the US – US consumers will pay more for Japanese products – but Japan has negotiated a deal that does only minor damage to its exports and economy in the process while presenting Trump with the ability to trumpet that he has opened up access to its domestic markets even though nothing material is likely to change. Indeed, unless Trump is forced to lower the rates on other countries auto and auto parts exports to the US, along with his sectoral tariffs on steel, aluminium and copper, the Japanese negotiators have given their key exporters a competitive edge. Trump says there's never been anything like the deal with Japan. He may be right, even if it appears he doesn't understand how it might play out in practice. There is a very large non-trade element to the deal. Japan has promised, it seems, to invest up to $US550 billion in the US, at Trump's direction and with the US allocated 90 per cent of any profits the investments might generate. The White House described the funding as the 'centrepiece' of the agreement with Japan, with the US Treasury Secretary, Scott Bessent, saying Japan had been awarded the 15 per cent tariff rate 'because they were willing to provide this innovative financing mechanism.' There are few details available on what is being loosely described as a Japanese sovereign wealth fund dedicated to investing in strategic sectors like semi-conductors, pharmaceuticals, steel, shipbuilding, critical minerals and energy in the US. The Japanese say the funds will come from their state banks and government agencies and will be in the form of equity, debt and guarantees. That suggests the $US550 billion, if it ever materialises, will be largely loans and loan guarantees for Japanese and US companies investing in projects Trump deems important. The detail will matter. Having effectively been extorted into agreeing to provide the funding, they are hardly likely to hand over $US550 billion without conditions and safeguards to someone who has declared bankruptcy four times. Loading They also have China's precedent to guide them. To end Trump's 2018-19 trade war, China agreed to buy a massively increased volume of US products. It eventually bought a little more than half what it had agreed to. Japan can slow-walk the handing over of the funds, knowing that, if it stretches the process out, a new administration in 2029 might have different views on trade. The investment agreement, apparently the brainchild of the Commerce Secretary, Howard Lutnick as it became clear that Japan wasn't going to accede to Trump's most aggressive demands for market access, is a peculiar one if Trump's aim is, as he has always claimed, to reduce America's trade deficit. If Japan were to actually deliver $US550 billion of new capital inflows to the US, it would increase the trade deficit, not decrease it. It would also probably help push up the value of the US dollar, which has been tumbling, making US exports less competitive in international markets. Did anyone explain that to Trump? Trump says there's never been anything like the deal with Japan. He may be right, even if it appears he doesn't understand how it might play out in practice. The deal with Japan provides a benchmark for the European Union, which appears very close to either agreeing its own deal or walking away and retaliating with punitive tariffs on US imports. It could probably live with a 15 per cent rate and no cap on its auto exports, provided there is nothing in the US demands that relates to its valued-added tax system or its regulation of social media platforms and big technology companies. Once Trump's August 1 deadline for deals is reached, the larger picture of Trump's trade wars will be clear, if still quite messy with its range of different tariffs, different rates and side-deals like the Japanese funding. Loading Crudely, however, the new 'baseline' tariff rate for America's major trading partners now appears to be 15 per cent. The average effective US tariff rate will have risen from about 2.4 per cent before he took office again to something around 20 per cent. Trade flows will be distorted, global supply chains severely disrupted, US companies and consumers will be paying a big new tax on their spending and the US inflation rate, and interest rates, will be higher than they would otherwise have been. Will that make America great again?
The Age
24-07-2025
- Business
- The Age
Lost in translation: Trump doesn't seem to understand the ‘massive' deal he just made
The other big 'win' for the US was, Trump claims, the opening of its agricultural markets to US exports, particularly the market for rice, which has historically been extremely politically sensitive in Japan. According to the Office of the US Trade Representative, American farmers will have the same advantage as countries within the Trans-Pacific Trade Partnership in selling into the Japanese market. During the Obama administration, America was going to be a party to the Trans-Pacific Partnership, a free trade agreement whose members include Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam. It was Trump, within days of taking office in his first in January 2017, who withdrew the US from the TPP. America's farmers could have had the same trade terms with Japan as those countries eight years ago, if not for Trump. As for rice, Japan already imports up to 770,000 tonnes a year (the amount is capped to protect its own rice farmers), with the US supplying about 45 per cent of that volume. Yes, the US may be able to sell more and perhaps displace other suppliers, but Japan has reserved the right to decide the additional volume and quality of any extra imports from the US. Loading The bottom line for the trade elements of the deal is that it does lift the tariff rate on Japan's exports to the US – US consumers will pay more for Japanese products – but Japan has negotiated a deal that does only minor damage to its exports and economy in the process while presenting Trump with the ability to trumpet that he has opened up access to its domestic markets even though nothing material is likely to change. Indeed, unless Trump is forced to lower the rates on other countries auto and auto parts exports to the US, along with his sectoral tariffs on steel, aluminium and copper, the Japanese negotiators have given their key exporters a competitive edge. Trump says there's never been anything like the deal with Japan. He may be right, even if it appears he doesn't understand how it might play out in practice. There is a very large non-trade element to the deal. Japan has promised, it seems, to invest up to $US550 billion in the US, at Trump's direction and with the US allocated 90 per cent of any profits the investments might generate. The White House described the funding as the 'centrepiece' of the agreement with Japan, with the US Treasury Secretary, Scott Bessent, saying Japan had been awarded the 15 per cent tariff rate 'because they were willing to provide this innovative financing mechanism.' There are few details available on what is being loosely described as a Japanese sovereign wealth fund dedicated to investing in strategic sectors like semi-conductors, pharmaceuticals, steel, shipbuilding, critical minerals and energy in the US. The Japanese say the funds will come from their state banks and government agencies and will be in the form of equity, debt and guarantees. That suggests the $US550 billion, if it ever materialises, will be largely loans and loan guarantees for Japanese and US companies investing in projects Trump deems important. The detail will matter. Having effectively been extorted into agreeing to provide the funding, they are hardly likely to hand over $US550 billion without conditions and safeguards to someone who has declared bankruptcy four times. Loading They also have China's precedent to guide them. To end Trump's 2018-19 trade war, China agreed to buy a massively increased volume of US products. It eventually bought a little more than half what it had agreed to. Japan can slow-walk the handing over of the funds, knowing that, if it stretches the process out, a new administration in 2029 might have different views on trade. The investment agreement, apparently the brainchild of the Commerce Secretary, Howard Lutnick as it became clear that Japan wasn't going to accede to Trump's most aggressive demands for market access, is a peculiar one if Trump's aim is, as he has always claimed, to reduce America's trade deficit. If Japan were to actually deliver $US550 billion of new capital inflows to the US, it would increase the trade deficit, not decrease it. It would also probably help push up the value of the US dollar, which has been tumbling, making US exports less competitive in international markets. Did anyone explain that to Trump? Trump says there's never been anything like the deal with Japan. He may be right, even if it appears he doesn't understand how it might play out in practice. The deal with Japan provides a benchmark for the European Union, which appears very close to either agreeing its own deal or walking away and retaliating with punitive tariffs on US imports. It could probably live with a 15 per cent rate and no cap on its auto exports, provided there is nothing in the US demands that relates to its valued-added tax system or its regulation of social media platforms and big technology companies. Once Trump's August 1 deadline for deals is reached, the larger picture of Trump's trade wars will be clear, if still quite messy with its range of different tariffs, different rates and side-deals like the Japanese funding. Loading Crudely, however, the new 'baseline' tariff rate for America's major trading partners now appears to be 15 per cent. The average effective US tariff rate will have risen from about 2.4 per cent before he took office again to something around 20 per cent. Trade flows will be distorted, global supply chains severely disrupted, US companies and consumers will be paying a big new tax on their spending and the US inflation rate, and interest rates, will be higher than they would otherwise have been. Will that make America great again?
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First Post
23-07-2025
- Politics
- First Post
Trump grows his multilateral exit list, reverses Unesco decision in just 2 years
With the withdrawal from the Unesco, President Donald Trump has abandoned yet another multilateral institution, making his disdain for multilateralism clear. Here we explore other institutions that he has quit — and how these withdrawals empowered US' adversaries. read more President Donald Trump has withdrawn the United States from Unesco over the institution's purported woke policies and support for Palestine. While the Trump administration has pitched the withdrawal from Unesco and other such organisations as part of the 'America First' agenda, such exits have actually helped US adversaries like Russia and China to expand their global footprint by filling the vacuum created by the US withdrawal. The United Nations Educational, Scientific and Cultural Organization (Unesco) is the latest organisation that Trump has withdrawn from. He h as previously withdrawn from the World Health Organization (WHO), the Paris climate agreement, and a host of bilateral and multinational treaties. STORY CONTINUES BELOW THIS AD ALSO READ: Is Trump really a master dealmaker? Here's how his 1st term's deals played out These withdrawals are rooted in Trump's disdain for multilateralism that has seen him even ditch alliances that have been central to US foreign and defence policies for generations. Trump's long war on multilateralism Trump began the war on multilateralism and has continued it in his second term. In 2017, Trump withdrew from the Paris climate agreement, the Trans-Pacific Partnership (TPP), and Unesco. In 2018, Trump withdrew the United States from the Iran nuclear deal that the previous Barack Obama administration had negotiated with Iran along with the European Union (EU), United Kingdom, France, China, Russia, and Germany. In his second term in 2025, Trump has also withdrawn from the WHO, the UN human rights body, and the UN Palestinian agency. Trump has also withdrawn from the Paris climate agreement and Unesco that the United States had joined under the previous Joe Biden administration. Trump has also essentially withdrawn from the security commitment to Europe under the blanket of Nato. In the run-up to the 2024 election, he had said he would encourage Russia to 'do whatever the hell they want' to European Nato allies if they would not do his bidding. In addition to putting into question the US commitment to Nato, Trump has also indicated he could abandon Aukus, a security partnership for the Indo-Pacific region with the UK and Australia that involved making nuclear submarines for Australia. Trump's Department of Defence has initiated a review of the pact. Trump goes after woke UN — and hands China a victory The Trump administration has based the withdrawal from Unesco on two topics it has weaponised: purported wokeness and criticism of Israel. White House Deputy Spokesperson Anna Kelly said that Trump withdrew from Unesco because the organisation 'supports woke, divisive cultural and social causes that are totally out-of-step with the commonsense policies that Americans voted for in November'. STORY CONTINUES BELOW THIS AD Separately, State Department Spokesperson Tammy Bruce said that Unesco's agenda was to 'advance divisive social and cultural causes' and that the organisation's decision in 2011 'to admit the 'State of Palestine' as a Member State is highly problematic, contrary to US policy, and contributed to the proliferation of anti-Israel rhetoric within the organisation'. Irrespective of whatever the Trump administration may say, the only beneficiaries of such withdrawals have been US adversaries like China and Russia. Power does not remain in vacuum and if the United States would any place, either a strategic theatre like Europe or multinational organisation like the UN, China is going to increase the footprint there and increase its influence and dominance, according to Prof Tej Pratap Singh, a scholar of China at the Department of Political Science, Banaras Hindu University (BHU). ALSO READ: Is Trump on a mission to make China great again? Trump has nearly shut down foreign aid via USAID and paralysed a host of humanitarian programmes in Africa, erasing goodwill generated over decades of hard work across the administrations of both the parties. By killing American goodwill and giving China an opening to expand influence is a self-goal — the withdrawal from Unesco is the latest such self-goal. STORY CONTINUES BELOW THIS AD 'Developing countries need assistance. If the United States withdraws, China will reach out to these nations and they will be glad to have Chinese support. China has been making inroads in Africa for many years and the US withdrawal is set to increase that. India has been countering Chinese influence in the Global South but countering China needs joint efforts and, in the absence of US involvement, China is set to make good gains,' Singh previously told Firstpost.
