Japan PM says win-win trade deal with US may be hard to implement

[TOKYO] The trade deal reached last month between the US and Japan was “win-win” for both countries, but implementing the terms of the pact may be a bigger challenge than reaching the deal, Japanese Prime Minister Shigeru Ishiba said.

“Some say that carrying the trade deal out is harder than agreeing on it. I humbly seek your continued support on this,” Ishiba said on Monday (Aug 4) in response to questions in parliament.

At the same session of parliament, Japan’s chief trade negotiator Ryosei Akazawa acknowledged criticism over the lack of having anything in writing.

“It’s my understanding that having something on paper would be helpful,” Akazawa said, adding that there’s also nothing in writing related to Washington’s deals with the EU and South Korea.

The comments underscore the vast uncertainties related to the raft of global trade deals, even after a deadline for higher tariffs was reached on Aug 1. Washington agreed to assess a 15 per cent across-the-board levy on imports from Japan, a lower rate than the previously threatened 25 per cent. The fate of auto tariffs is still unclear.

Ishiba, under pressure after last month’s setback in the upper house election, has vowed to stay on as premier in order to ensure the trade deal is fully implemented. A few days after the election, Ishiba secured the surprise trade deal that delivered relatively better results to Japan compared with other nations.

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The car tariffs, currently at 27.5 per cent including a pre-existing 2.5 per cent rate, have delivered a major blow to the Japanese economy as the sector is the biggest source of exports to the US and accounts for roughly 10 per cent of economic output.

“We should first devote all our efforts to properly lowering automobile tariffs, which are most closely related to our national interests, and to getting a presidential order issued,” Ishiba said.

Support for Ishiba’s Cabinet rose four percentage points to 36.8 per cent in a poll conducted over the weekend by JNN. Support for Ishiba’s Liberal Democratic Party (LDP) nudged lower from the previous month’s survey to 20.4 per cent, while the right-wing Sanseito party saw its support rise four points to 10.2 per cent, making it the second most-popular party.

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Pressed on when the government might implement subsidies meant to help households cope with soaring living costs, Ishiba said that it would depend on discussions with other parties.

The setback in last month’s election resulted in the government losing its majority in the upper house, after it lost its lower house majority last October. It’s the first time in 70 years that an LDP-led coalition is having to govern without a majority in either house of parliament. BLOOMBERG