Business / Economy

Motegi hints that Japan asked U.S. for exemption from planned auto tariffs

Kyodo

Economic revitalization minister Toshimitsu Motegi indicated Friday that he has requested that the United States exempt Japan from a controversial plan to impose stiff tariffs on car and parts imports.

“I made it clear to the U.S. side that it is indispensable for Japan and the United States to ensure confidence building in trade policy,” Motegi said after a two-day meeting with U.S. Trade Representative Robert Lighthizer in the first round of ministerial trade talks in Washington.

“We agreed to continue consultations based on the relationship of trust,” Motegi told reporters.

His comments were taken as urging President Donald Trump’s administration not to hit Japan, a principal U.S. ally in Asia, with additional levies of up to 25 percent on imported cars and parts, on top of the global tariffs of 25 percent on steel and 10 percent on aluminum that Washington invoked in March.

Motegi and Lighthizer plan to hold the second round of their talks in September, likely before an anticipated meeting between Trump and Prime Minister Shinzo Abe on the sidelines of the U.N. General Assembly, the economic revitalization minister said.

A statement issued by the USTR’s office said that Motegi and Lighthizer “agreed to continue the consultations based on mutual trust and to further deepen the discussions in the next round of the ministerial consultations to be held sometime in September.”

Late last month, the European Union won exemption from Trump’s planned tax on imported cars and parts. If Trump follows through with the plan after a Section 232 national security investigation into automobile and parts imports, the new duties would significantly impact major car exporters such as Japan.

During the trade talks, Motegi and Lighthizer agreed to explore ways to “fill the gap between their positions and to promote trade between the United States and Japan,” the USTR statement said, without mentioning their differing views on the Trans-Pacific Partnership or auto and agricultural trade.

Motegi said he told Lighthizer that the TPP — an 11-member regional trade pact from which Trump withdrew the United States last year — may come into force early next year.

During the first day of talks, Motegi called for a U.S. return to the TPP, saying it is the best trade deal for the two countries. But Lighthizer pushed for a bilateral trade deal as a way of reducing the chronic U.S. trade deficit with Japan.

The U.S. goods trade deficit with Japan totaled $68.85 billion in 2017, the third-largest among countries with which the United States generated a trade deficit, according to Commerce Department data.

Asked if Lighthizer pressed Japan to increase market access for U.S. agriculture, Motegi acknowledged the two ministers exchanged views on specific sectors in a candid way, but only said, “Nothing has been decided on individual issues.”

Motegi said he and Lighthizer agreed to further promote bilateral cooperation on international economic issues, citing coercive technological transfer, violation of intellectual property rights and matters related to state-owned enterprises in a veiled reference to China’s widely criticized trade practices.