Japan emerged Tuesday as the first great economy to ensure priority tariff negotiations with Donald Trump, highlighting his status as a largest creditor and investor of Washington and triggering a 7% increase in the actions listed in Tokyo.
The equity market, which has almost completely overturned the general collapse on Monday of Japanese action, followed a conversation of 25 minutes between the American president and the Japanese Prime Minister Shigeru Ishiba, in which the leaders agreed to open negotiations.
After the call, Trump posted on his social platform Truth according to which Japan had treated the United States “very badly” on trade. “They don’t take our cars, but we take millions of their. Likewise agriculture, and many other “things”. Everything must change, but especially with China !!! »»
Ishiba has appointed its Minister of Economic Revitalization Ryosei Akazawa as a chief negotiator of Japan for talks, which Tokyo officials expect to start “very soon”, reflecting the country’s need to protect its automotive industry, on which a significant proportion of the economy is built.
The American part will be led by the Treasury Secretary Scott Bessent, as well as the US trade representative Jamieson Greer. Bessent said on Fox News on Monday that he “expects to expect Japan would have the priority when they appear very quickly”.
Akazawa told journalists on Tuesday that the role of Bessent as head of the American delegation suggested that the White House “has a strong interest in the areas it supervises”.
These remarks have triggered expectations among investors that, in addition to prices, negotiations would also focus on the exchange rate in dollars, which has become a source of controversy for the Trump administration.
“The Bank of Japan is fiercely independent, but while Japan is looking for a means of alleviating these steep prices, there will be pressure on the central government to accelerate interest rates and send the higher Yen,” said Neil Newman, head of strategy at Astris Advisory Japan.
Japan, which considers itself to be the closest ally of Washington in Asia, was amazed last week by Trump’s announcement by a 24% tariff on its imports, in addition to the 25% levy on vehicles. Ishiba called “national crisis” measures for Japan.
Analysts have warned that the price burden would be disastrous for Japan, which – despite long -term investment in manufacturing based in the United States – benefits a lot of exports and is based on relatively low trade.
Ishiba reminded Trump on Monday the status of his country as the largest foreign investor in the United States and warned that business investment flow was threatened by threatened withdrawals.
Takeshi Yamaguchi, economist in Japan at Morgan Stanley Mufg Securities, said that American-Chinese tensions could potentially serve as a rear wind for Japanese-Japanese negotiations.
“Japan will have to propose a package to reduce the deficit since the US administration considers it a problem,” said Yamaguchi. He suggested possibilities such as the increase in imports of American agricultural products, defense equipment and energy, as well as coordination commitment with the United States in the event of excess depreciation.
In another signal of the American opening, Trump ordered a new national security review on the proposed takeover of Nippon Steel on Monday to $ 15 billion from US Steel, based in Pennsylvania. The examination, which will be led by the Treasury Department, will provide a recommendation to Trump within 45 days.
Joe Biden had blocked the takeover in January in one of his last acts in office. Trump had also reported an opposition to a complete takeover.
But the leaders of Japanese Steel negotiated with the US Secretary of Commerce Howard Lutnick on the framework and the terms of an agreement in which the Japanese group would take a majority participation in the US Marshal-West, according to two people familiar with the issue.
The actions of Japanese Steel increased by 10.5% Tuesday morning before making gains in the afternoon to exchange 6.3%.
In a statement, the company said that it “impatiently awaits a timely resolution so that we can start to make our planned investments that will position our American steel to become a world’s main producer of steel”.