President Trump says the United States and Japan have reached what he calls the “first stage of a phenomenal new trade agreement.” But the full details are a little less clear.
The United States and Japan have a trade deal, but a very limited trade deal. President Trump told reporters “this is a big chunk, but in the fairly near future we’re going to be having a lot more comprehensive deals signed with Japan.”
The reaction from Japan’s government is a bit more restrained. Prime Minister Shinzo Abe did call the agreement a “win-win solution for Japan and the United States” — but the prospect for a bigger deal remains uncertain.
The president says the current understanding will open new markets to some 7-billion dollars in U.S. agricultural products — while tariffs will be coming down on products from beef and pork to corn and wine.
A broad arrangement on digital trade is also part of the discussions. But there is an elephant in the room – actually, it’s more like a Toyota.
The current deal doesn’t say anything about autos and auto parts — which are currently and historically the biggest part of the trade imbalance between the two economies.
That may prove a more difficult set of negotiations.
According to U.S. government figures Japan had a trade surplus with the United States last year of nearly 68-billion dollars.