REUTERS: US President Donald Trump on Monday (Aug 26) said the United States would not imminently impose new tariffs on autos imported from Japan as the largest and third-largest economies continue their trade negotiations.
At a press conference during a global summit in Biarritz, France, Trump was asked if he was still considering the levies, which he can institute under US trade law if his administration finds that the imports threaten national security.
“Not at this moment, no, not at this moment,” Trump said. “It’s something I could do at a later date if I wanted to but we’re not looking at that.”
Trump and Japanese Prime Minister Shinzo Abe announced a broad agreement on Sunday, with Tokyo making concessions on agriculture and Washington maintaining its current auto tariffs of 2.5 per cent on passenger vehicles and 25 per cent on pickup trucks.
Details of the framework agreement have not been released.
US Trade Representative Robert Lighthizer said at the G7 summit that the deal had the potential to boost annual US agricultural exports by up to US$7 billion from the current level of US$14 billion, aiding US producers of beef, pork, wheat, dairy products and ethanol.
An executive of a Japanese automaker familiar with the talks said there was no change to auto tariffs and Japan appeared to have gained a continued reprieve from threatened US national security tariffs of 25 per cent on auto exports to the United States.
The deal, which needs to be fleshed out in detailed negotiations over the next month, is expected to restore some of the US agricultural access to the Japanese market lost when Trump pulled the United States out of the Trans-Pacific Partnership trade deal in 2017 just after he took office.
US beef and other products have been at a disadvantage to competition from Australia and Canada, which remained in TPP.
At the announcement with Abe, Trump said Japan had agreed to buy excess US corn that is burdening farmers as a result of the tariff dispute between Washington and Beijing. Abe referred to a potential purchase of the corn and said it would be handled by the private sector.
Despite the lack of detail, agriculture groups, whose members have been battered by the US-China trade war, welcomed news of progress in the US-Japan trade talks.
“Farmers and ranchers needed a win, and the preliminary agreement between the US and Japan comes at a critical time. With major competitors eyeing our market share in Japan, expanding access for US producers is critical,” said Barbara Glenn, CEO of the National Association of State Departments of Agriculture.
The National Corn Growers Association said the agreement was “very encouraging news,” but added that it “is continuing conversations with the Trump Administration to learn more details on what specifically Sunday’s announcement will mean for America’s corn farmers.”