U.S.-Japan trade deal on the horizon

With the 2020 elections coming up, Trump is under pressure to deliver to his constituents in key swing states; these are the voters who ensured he became President.

U.S. President Donald Trump as well as Japanese Prime Minister Shinzo Abe stated, they have agreed to a trade deal in principle and are aiming to sign one next month in New York.

The potential trade agreement comes in the wake of an escalating trade war between the United States and China.

In a statement, U.S. Trade Representative Robert Lighthizer stated, the potential deal will cover agriculture, digital trade and industrial tariffs. Tariffs on automobiles would however remain unchanged.

Incidentally, Japan stated it has agreed to buy excess U.S. corn that has become a burden for Washington due to the U.S.-China trade war. Abe referred to the potential purchase of U.S. corn saying it would be handled by the private sector.

“It’s a very big transaction, and we’ve agreed in principle. It’s billions and billions of dollars. Tremendous for the farmers,” said Trump on the deal during a joint announcement with Abe at the G7 meeting in France.

Although more ground will have to be covered before a deal is agreed and signed, Abe expressed optimism that it would be completed by the time of the United Nations General Assembly next month.

“We still have some remaining work that has to be done at the working level, namely finalizing the wording of the trade agreement and also finalizing the content of the agreement itself,” said Abe. “But we would like to make sure that our teams … accelerate the remaining work for us to achieve this goal of realizing the signing of the agreement on the margins of the U.N. General Assembly at the end of September.”

According to Lighthizer, the potential agreement could see Japan increase its import of U.S. beef, dairy products, pork, wine, wheat, and ethanol.

“It will lead to substantial reductions in tariffs and non-tariff barriers across the board,” said Lighthizer while not divulging other details of the potential deal.

The development comes in the wake of Trump ordering U.S. companies to start looking for alternatives to doing business in China.

Categories: Creativity, Economy & Finance, Entrepreneurship, Geopolitics, HR & Organization, Regulations & Legal, Strategy, Sustainability

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