US and Japan to begin free trade deal negotiations on Thursday

US and Japan to begin free trade deal negotiations on Thursday

The first round of bilateral trade negotiations between the US and Japan will be held in Washington today. The talks

Japan US free trade talks

Photo: AP

The first round of bilateral trade negotiations between the US and Japan will be held in Washington today.

The talks follow months of economic tension between the countries, prompted by the Trump administration pulling the US out of the Trans-Pacific Partnership. Japan was also among countries hit by metal tariffs—an attempt to decrease Washington’s trade deficit.

Today’s negotiations come as the White House considers a 25% tariff on automobile imports—a major threat to the Japanese auto industry, which exported $40 billion worth of goods to the US last year. The imposition of such measures would account for a significant portion of America’s $68.9 billion trade deficit with Japan last year. But while this may look good to trade hawks on paper, the tariffs also threaten American auto companies, which largely manufacture cars outside the country or rely on imported components.

Expect today’s talks to do little to ease tensions in the short-term. While Washington pushes for a bilateral deal today, Tokyo remains adamant about US involvement with the broader region through agreements like the TPP. That option, however, seems off the table for Trump. Expect growing tensions between the allies, especially if Trump goes ahead with his tariff spree.

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