WASHINGTON – U.S. President Donald Trump said Monday that the United States would not have secured new trade negotiations with Japan without the threat of stiff tariffs on automobiles and parts.
“Without tariffs we wouldn’t be talking about a deal,” Trump said after he and Prime Minister Shinzo Abe agreed last week to start talks for a bilateral trade agreement on goods. The move is a concession by Tokyo, which dropped its earlier insistence on a multilateral approach to trade issues.
Speaking to reporters at the White House, he said Abe told his predecessor, Barack Obama, that Japan was not going to negotiate a bilateral trade deal.
“I said, ‘You don’t have to negotiate, but we’re going to put a very, very substantial tax on your cars if you don’t,’ ” the Republican president said.
“We’re totally prepared to do that if they don’t negotiate. But Japan is wanting to negotiate. Actually, they called about three weeks ago,” Trump said. “And they said, ‘We’d like to start negotiations immediately.’ “
Trump continued, “So because of the power of tariffs and the power that we have with tariffs, we, in many cases, won’t even have to use them. That’s how powerful they are, and how good they are.”
In a meeting last Wednesday on the sidelines of the U.N. General Assembly in New York, Abe and Trump agreed that the United States will refrain from imposing automobile tariffs on Japan while talks are underway.
Trump quoted Abe as telling him that many Japanese automobile companies have invested in the United States over the last year and a half, and that they will continue to do so.
“It’s true, (they) had big expansions,” the U.S. leader said. “And very importantly, he said, ‘many more are coming,’ because they have an incentive now to be here.”
Touching on a new three-way trade deal struck with Canada and Mexico in place of the North American Free Trade Agreement, Trump said it represents a “great victory” for American farmers and a “historic win” for American manufacturers and autoworkers.
“The agreement will give our farmers and ranchers far greater access to sell American-grown produce in Mexico and in Canada,” he said. “The deal includes a substantial increase in our farmers’ opportunities to export American wheat, poultry, eggs and dairy, including milk, butter, cheese, yogurt and ice cream, to name a few.”
The remarks suggest that the Trump administration may also push Japan hard to further open its auto and farm markets as part of efforts to reduce the chronic U.S. trade deficit.
Trump accused Japan, China, the European Union and other trading partners of taking advantage of the U.S. through trade he sees as neither fair nor reciprocal.
“Over the last five years, we’ve averaged $800 billion a year loss on trade,” he said. “That’s dealing with China, dealing with the European Union, dealing with everybody, Japan, Mexico, Canada, everybody.
“And we’re not going to allow that to happen.”