Business leaders laud Japan-US trade deal, admit ongoing challenges
"The persistent negotiations paid off," Yoshinobu Tsutsui, chairman of the Japanese Business Federation, the country's most powerful business lobby also known as Keidanren, told reporters, adding his group has "high regard" for the outcome.
The tariffs under the deal, which was first announced by U.S. President Donald Trump on Tuesday, are lower than initially proposed. They were agreed before an Aug. 1 deadline set by the United States to impose a "reciprocal" 25 percent tariff on Japanese goods.
"I have yet to look into the details, but would like to provide support (from Keidanren) on multiple fronts," Tsutsui said.
While some companies have expressed hope that the potential adverse effects of the levies would be eased, others said challenges were likely to persist as they nevertheless remained high.
"The evasion of even higher tariffs across the board may act as a crucial breakwater for companies," said Takeshi Niinami, chairman of the Japan Association of Corporate Executives.
"We must work toward rebuilding a free-trade system," he added, also warning of the spread of the "America First" approach.
While saying the deal helped remove U.S. tariff uncertainties, Ken Kobayashi, chairman of the Japan Chamber of Commerce and Industry, called the 15 percent tariffs "regrettable."
"The effects of this new burden of tariffs will hit not just exporter firms, but also those that shoulder the domestic supply chain and are largely made up of small and medium-sized firms that are responsible for supplying parts and logistics," he said in a statement.
The Trump administration's 25 percent additional auto tariff was one of the biggest sticking points in the trade talks. Combined with the 2.5 percent rate already in place, a total tariff of 27.5 percent was imposed on imported passenger vehicles in April.
Following the latest announcement, a source from a major automaker expressed dismay at the deal, noting tariffs prior to Trump's inauguration had stood at just 2.5 percent.
Meanwhile, a source from an electronics manufacturer noted that "compared with the 25 percent tariff that was slated to hit on Aug. 1, 15 percent is slightly better."
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Nikkei Asia
2 hours ago
- Nikkei Asia
US and EU agree to 15% tariff on EU goods, $600bn in investments
TURNBERRY, Scotland (Reuters) -- The United States struck a framework trade deal with the European Union on Sunday, imposing a 15% U.S. import tariff on most EU goods but averting a spiraling battle between two allies which account for almost a third of global trade. The announcement came after European Commission President Ursula von der Leyen traveled for talks with U.S. President Donald Trump at his golf course in western Scotland to push a hard-fought deal over the line. "I think this is the biggest deal ever made," Trump told reporters after an hourlong meeting with von der Leyen, who said the 15% tariff applied "across the board." "We have a trade deal between the two largest economies in the world, and it's a big deal. It's a huge deal. It will bring stability. It will bring predictability," she said. The deal, that also includes $600 billion of EU investments in the United States and significant EU purchases of U.S. energy and military equipment, will indeed bring clarity for EU companies. However, the baseline tariff of 15% will be seen by many in Europe as a poor outcome compared to the initial European ambition of a zero-for-zero tariff deal, although it is better than the threatened 30% rate. The deal mirrors parts of the framework agreement the United States clinched with Japan last week. "We are agreeing that the tariff ... for automobiles, and everything else will be a straight-across tariff of 15%," Trump said. However, the 15% baseline rate would not apply to steel and aluminum, for which a 50% tariff would remain in place. Trump, who is seeking to reorder the global economy and reduce decades-old U.S. trade deficits, has so far reeled in agreements with Britain, Japan, Indonesia and Vietnam, although his administration has failed to deliver on a promise of "90 deals in 90 days." He has periodically railed against the European Union, saying it was "formed to screw the United States" on trade. Arriving in Scotland, Trump said that the EU wanted "to make a deal very badly" and said, as he met with von der Leyen, that Europe had been "very unfair to the United States." His main bugbear is the U.S. merchandise trade deficit with the EU, which in 2024 reached $235 billion, according to U.S. Census Bureau data. The EU points to the U.S. surplus in services, which it says partially redresses the balance. Trump also talked on Sunday about the "hundreds of billions of dollars" that tariffs were bringing in. On July 12, Trump threatened to apply a 30% tariff on imports from the EU starting on Aug. 1, after weeks of negotiations with the major U.S. trading partners failed to reach a comprehensive trade deal. The EU had prepared countertariffs on 93 billion euros ($109 billion) of U.S. goods in the event there was no deal and Trump had pressed ahead with 30% tariffs. Some member states had also pushed for the bloc to use its most powerful trade weapon, the anticoercion instrument, to target U.S. services in the event of a no-deal.
Nikkei Asia
3 hours ago
- Nikkei Asia
Trump, EU's von der Leyen meet to clinch trade deal, rating chances 50-50
TURNBERRY, Scotland (Reuters) -- European Commission President Ursula von der Leyen met with U.S. President Donald Trump on Sunday to clinch a trade deal that would likely result in a 15% tariff on most European Union goods but end months of uncertainty for EU companies. U.S. and EU negotiators huddled in final talks on tariffs facing crucial sectors like cars, steel, aluminum and pharmaceuticals before the meeting began at Trump's golf course in Turnberry, western Scotland. Trump, who had earlier played a round with his son, told reporters as he met with von der Leyen that he wanted to correct a trading arrangement he said was "very unfair to the United States" and repeated his comments from Friday that the chances of a U.S.-EU deal were 50-50, a view echoed by von der Leyen. "We have three or four sticking points I'd rather not get into. The main sticking point is fairness," he said, insisting the EU had to open up to American products. Von der Leyen acknowledged there was a need for "rebalancing" EU-U.S. trade. "We have a surplus, the United States has a deficit and we have to rebalance it ... we will make it more sustainable," she said. U.S. Commerce Secretary Howard Lutnick, who flew to Scotland on Saturday, told "Fox News Sunday" that the EU needed to open its markets for more U.S. exports to convince Trump to reduce a threatened 30% tariff rate that is due to kick in on Aug. 1. "The question is, do they offer President Trump a good enough deal that is worth it for him to step off of the 30% tariffs that he set?" Lutnick said, adding that the EU clearly wanted -- and needed -- to reach an agreement. A separate U.S. administration official was upbeat that a deal was possible. "We're cautiously optimistic that there will be a deal reached," the official said, speaking on condition of anonymity. "But it's not over till it's over." The EU deal would be a huge prize, given that the U.S. and EU are each other's largest trading partners by far and account for a third of global trade in goods and services. Ambassadors of EU governments, on a weekend trip to Greenland organized by the Danish presidency of the EU, held a teleconference with European Commission officials on Sunday to agree on the amount of leeway von der Leyen would have. In case there is no deal and the U.S. imposes 30% tariffs from Aug. 1, the EU has prepared countertariffs on 93 billion euros ($109 billion) of U.S. goods. EU diplomats have said a deal would likely include a broad 15% tariff on EU goods imported into the U.S., mirroring the U.S.-Japan trade deal, along with a 50% tariff on European steel and aluminum for which there could be export quotas. EU officials are hopeful that a 15% baseline tariff would also apply to cars, replacing the current 27.5% auto tariff. Some expect the 27-nation bloc may be able to secure exemptions from the 15% baseline tariff for its aerospace industry and for spirits, though probably not for wine. The EU could also pledge to buy more liquefied natural gas from the U.S., a long-standing offer, and boost investment in the United States. Trump told reporters there was "not a lot" of wiggle room on the 50% tariffs that the U.S. has on steel and aluminum imports, adding that "because if I do it for one, I have to do it for all." The U.S. president, in Scotland for a few days of golfing and bilateral meetings, said a deal with the EU should draw to a close discussions on tariffs but also said pharmaceuticals, for which the United States is looking into new tariffs, would not be part of a deal. The EU now faces U.S. tariffs on more than 70% of its exports, with 50% on steel and aluminum, an extra 25% on cars and car parts on top of the existing 2.5%, and a 10% levy on most other EU goods. EU officials have said a "no-deal" tariff rate of 30% would wipe out whole chunks of transatlantic commerce. A 15% tariff on most EU goods would remove uncertainty but would be seen by many in Europe as a poor outcome compared to the initial European ambition of a zero-for-zero tariff deal on all industrial goods. Seeking to learn from Japan, which secured a 15% baseline tariff with the U.S. in a deal almost a week ago, EU negotiators spoke to their Japanese counterparts in preparation for Sunday's meeting. For Trump, aiming to reorder the global economy and reduce decades-old U.S. trade deficits, a deal with the EU would be the biggest trade agreement, surpassing the $550 billion deal with Japan. So far, he has reeled in agreements with Britain, Japan, Indonesia and Vietnam, although his administration has failed to deliver on a promise of "90 deals in 90 days."
Nikkei Asia
4 hours ago
- Nikkei Asia
Japan PM Ishiba's approval rating hits new low of 32%: Nikkei poll
Japanese Prime Minister Shigeru Ishiba is expected to make a final decision on his future as early as August. (Photo by Uichiro Kasai) Nikkei staff writers TOKYO -- The approval rating of Japanese Prime Minister Shigeru Ishiba's cabinet hit 32%, the lowest since his government's October 2024 launch, in the latest Nikkei/TV Tokyo survey. On the most suitable person to be the next prime minister, former Minister in charge of Economic Security Sanae Takaichi and Agriculture Minister Shinjiro Koizumi, both of Ishiba's ruling Liberal Democratic Party, tied for first place at 20% each. They were followed by Yuichiro Tamaki, leader of the Democratic Party For the People, at 9%. Ishiba came in fourth at 6%.
