WASHINGTON (REUTERS, AFP) - Japan’s economy minister said he had “frank and good” trade talks with his US counterpart on Monday (April 15) in the first round of negotiations between the two countries, the latest front in President Donald Trump’s aggressive, multi-pronged strategy to address “chronic US trade imbalances.”
The meeting comes after US President Donald Trump and Prime Minister Shinzo Abe agreed last September to start trade talks in an arrangement that protects Japanese automakers from further tariffs while talks are underway.
The US also appears to be approaching the final stages of a deal with China, while preparing for the start of negotiations with Europe.
Trump has made clear he is unhappy with Japan’s US$68 billion (S$92 billion) trade surplus with the United States – much of it from auto exports – and wants a two-way agreement to address it.
Economy Minister Toshimitsu Motegi told reporters that most of the three-hour meeting with US Trade Representative Robert Lighthizer was centered on goods.
Abe has stressed that the new framework would be a Trade Agreement on Goods, or TAG, not a more wide-ranging free trade agreement that included investments and services that Japan had resisted.
US Treasury Secretary Steven Mnuchin said over the weekend he sees good cooperation with Japan on exchange rates, looking to include a currency provision in any trade agreement to avoid currency manipulation.
When asked about exchange rates, Motegi said on Monday that Japan and the United States have already agreed that currencies should be discussed between respective finance ministers.
Motegi also said he confirmed with Lighthizer that new trade talks would proceed based on the two nations’ joint statement issued last September. It said talks “will respect positions of the other government,” drawing lines on autos and Japan’s agriculture sector.
“We had a frank and very good exchange of views on trade issues,” Motegi told reporters. He declined to be more specific, but said he would explain the contents of their talks after the second day of talks on Tuesday. A spokesman for the US Trade Representative declined to comment.
“The US probably doesn’t want to spend much time on trade talks with Japan and wants an early achievement,” said Junichi Sugawara, senior research officer at Mizuho Research Institute.
“The focus will be how Japan and the US will find a common ground as Japan doesn’t want to compromise on farm products and can’t accept auto export restriction.” Abe is scheduled to meet Trump in the US in late April for talks on North Korea and Japan-US trade.
Trump has focused attention on the countries which have the biggest trade surpluses with the United States, and has pushed his preference for country-specific rather than multilateral deals.
Trump and Japanese Prime Minister Shinzo Abe agreed in September to launch the talks between the world's first and third-largest economies, which represent about 30 per cent of global output.
Trump and Abe will have plenty of opportunities to talk trade in the coming months.
Abe is visiting the United States later this month and Trump is expected in Japan in May to pay his respects to the country's new emperor who will take the throne on May 1.
Trump is then expected back in Japan the following month as the western city of Osaka hosts the Group of 20 summit of world leaders on June 28-29.
Japan’s economy minister said he had “frank and good” trade talks with his US counterpart on Monday (April 15)