WASHINGTON/TOKYO – Japan and the United States have agreed to the broad outlines of a trade agreement, Japan’s top trade negotiator, Toshimitsu Motegi, suggested Friday, as the two countries work to seal a deal by the end of September.
“We’ve been able to see major progress,” Motegi told reporters in Washington following a three-day meeting with U.S. Trade Representative Robert Lighthizer. Motegi also said gaps no longer exist in their views, apparently referring to tariff cuts in key sectors such as beef and automobiles. He did not provide further details.
“These ministerial talks will probably be the last (toward a trade deal),” Motegi said.
The outcome of the talks will be endorsed by Prime Minister Shinzo Abe and U.S. President Donald Trump when they meet on the sidelines of the Group of Seven summit, beginning Saturday in France, and an announcement will be made then, according to Motegi.
Abe and Trump are expected to announce that they plan to strike a final deal in September, according to sources familiar with the matter. Japan will lower tariffs on U.S. beef and pork to the same levels as those of Trans-Pacific Partnership members, the Nikkei daily reported Saturday without citing sources.
The U.S. will keep its 2.5 percent tariff on Japanese automobiles, rather than raise it as Trump had threatened, while Japan’s tariffs on imported beef will be lowered gradually to 9 percent from 38.5 percent, the Nikkei reported.
Japan is seeking to stay in Trump’s good graces to avoid costly tariffs and retain positive relations with an ally that ensures its security against the likes of China and North Korea. Japan is also counting on U.S. support as its diplomatic spat with South Korea intensifies.
Trump, who threatened to raise tariffs on the approximately $50 billion worth of cars and auto parts Japan exports to the U.S. annually, had hinted that there might be a deal in August.
In a meeting in September last year, Trump and Abe agreed the United States would not demand deeper farm tariff cuts than levels Japan has agreed to elsewhere, such as in the revised TPP pact, an 11-nation deal that entered into force the same year.
The United States was among the TPP members but pulled out of the pact in 2017, with Trump preferring bilateral trade deals. Trump appears eager to claim a major trade victory to boost his 2020 re-election bid.
Motegi said Friday that the negotiations have taken place in line with the September agreement and asserted that he has stuck to his position of protecting Japan’s farm sector.