On Wednesday, the US and Japan announced the preliminary details of a limited trade deal. The deal will open markets in Japan to US farm produce which is a win for the Trump Administration. The administration has been struggling to finalize agreements with Canada, Mexico, China, and other countries.
Japan to open market of $7 billion for American agricultural products
According to the agreement, Japan will initially open their market up to around $7 billion for US agricultural products. President Trump revealed the news at the signing ceremony with Shinzo Abe, the Prime Minister of Japan. Trump said that the deal is a massive win for US ranchers, farmers as well as growers. Japan will ease tariffs on products such as pork and beef and also eliminate tariffs on products such as blueberries, broccoli, and almonds.
The president also confirmed that the two countries had committed to digital; trade of around $40 billion. The country will exclude custom duties on various products such as e-books, videos, and music, among other supplies.
Easing tariffs on Japanese car imports
The countries reached the agreement after the US eased its hard-line stand on Japanese car imports. It is still unclear what new access or protection the US offered the Japanese car sector, which is the main contributor to the trade deficit between the US and Japan.
Previously Japan had indicated that if the two countries were to reach a deal, then the US should not impose tariffs on Japanese cars. Negotiators had inserted a clause in the deal that could result in the agreement expiring should the US impose tariffs on Japanese cars. The two countries in the past week have been eager to announce a deal, cementing partnership between Trump and Abe.
This development comes at a time when the US is trying to repair damage from his tariff wars with China that has left most farmers hurting. Trump is determined to boost US farmers who have felt the effects of the trade war.