Japan & US Clash Over Trade – New Negotiations Confirmed as Tensions Simmer

Tokyo and Washington lock horns again—fresh trade talks confirmed amid escalating economic tensions.

Behind closed doors: What''s really at stake?

While bureaucrats exchange pleasantries, markets brace for impact. Another round of geopolitical poker where small businesses always seem to fold first.

Bonus jab: At least someone’s still using the dollar for something—even if it’s just trade war paperwork.

Japan’s PM hopes to talk with President Trump on the sidelines of the G7 Summit

The Japanese government described the talks on Saturday similarly to Akazawa’s Friday statement, terming the conversation as “very in-depth” and that the two parties explored the possibility of reaching an agreement that WOULD benefit both countries.

It added that their Prime Minister Shigeru Ishiba and US President Donald TRUMP could meet on the sidelines of the G7 summit starting Sunday in Canada, where they hope they can finalize a deal.

The country is still in for a 24% tariff rate on their exports starting in July unless it can secure a deal with the US. Tokyo is also pushing to shield its auto industry from a separate 25% US levy.

In earlier talks, Japan offered to increase imports of US agricultural goods and review its “non-tariff trade barriers” to American car sales to respond to the concerns of the Trump administration. In addition, the government is mulling to collaborate with the US to secure supply chains of rare earth magnets and semiconductors.

So far, China is the primary producer of high-performance rare earth magnets. However, Japan hopes to promote building supply chains with the US without relying on China. 

Often, rare earth magnets manufacture electric vehicle motors and missile devices. Regarding neodymium magnets, China produces more than 80%, while Japan accounts for only about 15%. The US has been scrambling for ways to deal with China’s dominance and restrictions on rare earths exports, and Japan could very well be the solution the country has been looking for.

Trump approved Nippon’s Steel bid for US Steel on Friday

US President Donald Trump recently approved Japan’s Nippon Steel’s $ 14.9 billion bid for US Steel. The Japanese company’s offer aroused much criticism and opposition over national security concerns. 

The order by Trump requires that the merger only go ahead if a deal is signed with the Treasury Department to resolve any national security risks. US Steel and Nippon Steel announced that they had reached a deal, which satisfied a critical requirement for Trump. They cited $11 billion in planned investments by 2028 and commitments on governance, production, and trade. Sources have said that the US government will also receive a golden share, which doesn’t involve an ownership stake.

Other reports say some of the top jobs will also be reserved for Americans, and Nippon Steel would also be required to invest $3 billion to build a new mill after 2028.

White House spokesman Kush Desai believes the deal will help Pennsylvania retain ownership of US Steel and protect the company as a critical element of the nation’s national and economic security. 

Japan’s Economy, Trade, and Industry Minister Yoji Moto also expressed confidence that the investment will enhance innovation in Japanese and US steel sectors while deepening their strong bilateral partnership. 

The merger agreement deadline is June 18, though the companies’ statement did not specify exactly when it will close.

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