U.S. Trade Representative Robert Lighthizer is expected to visit Japan on Friday, in an effort to negotiate a trade deal ahead of the summit meeting between Japanese Prime Minister Shinzo Abe and President Trump.
At the heart of current concerns are Japan’s sourcing of purchases away from established American suppliers and the declaration by the White House on Friday that some imported vehicles and vehicle parts posed a national security threat. Trump has used the designation of items as national security threats as an excuse to enact tariffs without authorization by Congress.
Kenji Wakamiya, chairman of the Foreign Affairs Committee in Japan’s House of Representatives, explained the situation for Reuters reporters.
“Even if Trump tells us desirable outcomes for him, it would be difficult for the Japanese government to tell carmakers what they should do. They have their ideas and shareholders … So it won’t be easy. Still, a move in that direction is one possible solution,” he said.Reuters
In response to concerns about American farmers losing market share in Japan due to the new avenues for goods opened by the CPTPP, Japan has recently responded by ending long-standing restrictions on U.S. Beef which were put into place following the “Mad Cow” outbreak of 2005.
The official U.S. policy as stated by the President is to drive the trade imbalance with Japan down, so that we are importing from them only as much as we are exporting to them. Census data indicates that this is not happening.
Japan’s actions and statements on trade have been working toward free market solutions – ending existing restrictions when disease concerns seem past and expecting the government to have a very light hand, rather than direct control, over what businesses sell if they are acting ethically. This is in keeping with the notion of individual liberty, where people are encouraged to buy items based on price, craftsmanship, desirability due to advertising, and other factors solely at the discretion of the purchaser; and suppliers see a demand and work to satisfy it. We have yet to see what the reaction by the Trump administration will be to such policies.