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Japan has mentioned it is not going to sacrifice its farmers to safe tariff exemptions from the US, as Tokyo and Washington hardened their positions in a rice diplomacy stand-off and hopes of an imminent commerce deal between the allies light.
The feedback from Japan’s chief cupboard secretary Yoshimasa Hayashi on Tuesday got here as Donald Trump solid Japan, amongst different nations, as “spoiled” and the most recent spherical of commerce negotiations in Washington ended with out clear progress.
“We’re not interested by doing something that will sacrifice the farm sector,” Hayashi mentioned.
Weeks of negotiations have produced quite a lot of proposals geared toward breaking a impasse, together with Japan shopping for extra US power and agricultural merchandise and new joint funding mechanisms for US manufacturing, in accordance with individuals conversant in the talks.
However none has succeeded at shifting the Trump administration’s dedication to lowering its commerce deficit with Japan, which stood at $63bn for the Japanese monetary yr ending in March.
In a publish on his Fact Social website on Monday, Trump targeted his ire on rice.
“To point out individuals how spoiled International locations have develop into with respect to the US of America, and I’ve nice respect for Japan, they gained’t take our RICE, and but they’ve a large rice scarcity,” wrote Trump.
The mix of a poor harvest and coverage have pushed rice costs to more than double previously yr, inflicting short-term shortages, big queues for cheaper rice and forcing the federal government to faucet its strategic rice reserve to offer aid.
Japanese rice manufacturing has for many years been an intensely political subject. The crop instructions an outsized nationwide significance and farmers have been a vital base of help for the long-ruling Liberal Democratic occasion.
The US exports some rice tariff free to Japan beneath a World Commerce Group “minimal entry” settlement, however Japan imposes a levy on any imports past a 770,000 tonne restrict.
Tokyo had initially hoped for a fast-track commerce take care of Trump. However with each side dug in, the LDP now faces the chance of a marketing campaign for higher home elections on July 20 and not using a deal in place, in accordance with individuals with direct information of negotiations. That may elevate the danger for Prime Minister Shigeru Ishiba, who’s struggling low approval rankings and has a comparatively fragile maintain on parliament.
It additionally comes as clouds are gathering over a Japanese economic system that relies upon closely on its automotive trade. The nation’s automotive trade instantly and not directly employs greater than 5.5mn individuals, in accordance with the Japan Vehicle Producers’ Affiliation.
Tokyo has consistently demanded a full exemption from Washington’s blanket 25 per cent tariff on automotive imports, in addition to the revocation of the 24 per cent “reciprocal” tariffs that Trump has threatened to impose on Japan. These levies have been paused till a July 9 deadline to signal a commerce deal.
However Japan’s possibilities of securing any tariff exemption within the brief time period seemed to be low and falling, mentioned two individuals near discussions.
In an interview with Fox Information final weekend, Trump bemoaned the “unfair” buying and selling relationship in blunt phrases, claiming that the US “[takes] tens of millions and tens of millions” of Japanese vehicles, whereas the Japanese “gained’t take our vehicles”.
Japan’s largest auto corporations have established massive manufacturing services within the US over many years. Automobile and truck exports to the US totalled 1.37mn automobiles in 2024, with the automotive sector representing about 28 per cent of Japan’s items exports to the US.
The US, in flip, exports few automobiles to Japan, the place American automotive fashions are usually seen as too massive and gasoline consumptive.
“I may ship one [letter] to Japan: ‘Pricey Mr Japan, right here’s the story’,” Trump continued. “You’re going to pay a 25 per cent tariff in your vehicles.”
