Japan Welcomes U.S.-EU Accord before Tokyo-Washington Trade Talks

July 27, 2018

Tokyo- Japan is welcoming Wednesday's agreement between the United States and the European Union to launch talks to ease trade tensions between the two sides, as Tokyo is preparing for the start of its own trade talks with Washington under a new scheme.

"We view it as a positive step," Chief Cabinet Secretary Yoshihide Suga said on Thursday of the U.S.-EU accord.

Within the Japanese government, however, there remain concerns about possible additional U.S. automotive tariffs, even though the United States and the EU are now expected to put on hold any further tariffs while their trade talks progress.

Japan, which has already scrapped its tariffs on imported U.S. cars, is facing a "different situation" from the EU, which currently levies 10 pct tariffs on U.S. and other vehicles, a government source pointed out.

"We don't think the risk (of hard-line steps by the United States) has disappeared," Nissan Motor Co. Corporate Vice President Joji Tagawa told a press conference. "We need to keep close watch" on related developments, he said.

In April, Tokyo and Washington agreed to launch talks between Japanese fiscal and economic policy minister Toshimitsu Motegi and U.S. Trade Representative Robert Lighthizer to promote free, fair and reciprocal trade, or FFR.

The FFR talks were initially planned to be launched this month, but are now expected to be started in August or later.

The new dialogue is expected to focus on correcting imbalances in bilateral automotive trade. Japan is eager to persuade the United States not to impose additional auto tariffs.

The possible U.S. tariffs "could deal a heavy blow" to Japan as automotive shipments account for some 30 pct of Japan's overall exports to the United States, a senior Japanese trade ministry official said. Jiji Press