TOKYO/NEW DELHI/SEOUL – No accord was signed, and a yawning gap still remains between the two countries.
But to all intents and purposes, the first round of trade talks between the US and Japan on April 16 is seen in Tokyo as a relative success.
Not that US President Donald Trump moved even a millimetre on any of his positions on tariffs.
But he touted “big progress” in discussions with Japan’s Economic Revitalisation Minister Ryosei Akazawa, whom Prime Minister Shigeru Ishiba appointed as tariff czar. US Treasury Secretary Scott Bessent, Commerce Secretary Howard Lutnick and Trade Representative Jamieson Greer were also involved in the talks.
“A Great Honour to have just met with the Japanese Delegation on Trade. Big Progress!” Mr Trump wrote on his Truth Social platform, attaching a photograph of him and Mr Akazawa sporting broad grins.
The US President also gave Mr Akazawa a signed “Make America Great Again” cap.
He had on April 2 announced “reciprocal” tariffs ranging from 10 per cent to 50 per cent on many of the US’ trading partners, with Japan being slapped with 24 per cent. These tariffs are now on pause for 90 days until July 8 and many countries are scrambling to negotiate with the US over them.
These countries include South Korea and India, which may be looking for clues in Japan’s approach to build rapport with the mercurial president. But there were few hints forthcoming, as concrete details remain scant.
South Korea, like Japan, has borne the brunt of Mr Trump’s criticism that it is not doing enough in defence cost sharing, with both East Asian countries being host to thousands of US troops.
Mr Trump raised the issue of defence burden with Japan on April 16 and said on Truth Social that it would be part of talks with Seoul.
India, also like Japan, has been assailed for agricultural barriers.
South Korea has been slapped with a 25 per cent tariff and India 26 per cent.
A reality check
Back in Tokyo, Mr Ishiba gave a dose of reality: “There are still gaps between the respective stances of Japan and the US. Negotiations going forward won’t be easy.”
The two sides have agreed to reconvene talks later in April. But when and where is yet to be determined.
Mr Ishiba, however, struck a positive note when he said it was “good that the meeting laid the groundwork for the next round” and that he would visit the US personally to speak with Mr Trump “at the most appropriate time”.
While the reciprocal tariffs are on pause, the US is still charging a 10 per cent baseline universal tariff and a 25 per cent tariff on cars, car parts, steel and aluminium exports to the country.
Japan, a long-time US ally and major investor in the US, where it has created hundreds of thousands of jobs, is still subjected to these other tariffs.
There is already evidence of the impact wrought on supply chains.
Steel exports to the US from Japan and South Korea fell sharply in March, dropping 16.6 per cent and 24 per cent respectively from a year earlier after US steel tariffs began in March.
Data by Japan’s Finance Ministry on April 17 also showed that the country’s surplus with the US stood at nine trillion yen (S$83 billion) in the fiscal year ending March 2025, down 1.3 per cent from a year before.
Ms Asuka Tatebayashi, a senior analyst at Mizuho Bank’s global strategic advisory department, told The Straits Times that Japan’s chief priority was to secure concessions on tariffs over the auto industry, which has been described as the “backbone of the Japanese economy”.
Nissan and Honda have already said that they would shift some of their production to the US.
Chips to play
Waseda University economist Yasuyuki Todo told ST that both countries could seek win-win outcomes.
For one thing, Japan could ease its tariffs on agricultural imports like rice and beef, given that Japanese consumers are suffering from inflation on food, he said, adding that Japan could ease non-tariff barriers such as auto safety standards to some degree.
He further saw Japan cooperating with the US on Alaskan liquefied natural gas (LNG) pipelines, which would “benefit Japan’s energy security and lower its trade surplus with the US”.
But Japan and the US remain at odds over issues such as agriculture, with Mr Trump complaining that Tokyo was imposing a 700 per cent tariff on rice. Japan has said this statistic was “incomprehensible” and not true – Japan imposes a tariff of 341 yen per kg of imported rice exceeding a duty-free quota.
The farmers’ lobby
The US is also expected to raise the issue of agricultural barriers with Indian negotiators.
This is as New Delhi has been providing sweeteners since February to the US to get ahead of the reciprocal tariffs, such as slashing duties on US imports like bourbon and assessing the purchase of US F-35 fighter jets.
Whether these would persuade the US to ease off on agriculture, however, is a big question mark.
Mr Lutnick remarked in an interview in February that India “won’t let us sell a bushel of corn, and think of the stuff they sell here. You got to be kidding”.
But farming groups are heavily influential in India, and the agriculture lobby has said it will come out in large numbers to protest if Prime Minister Narendra Modi makes excessive concessions.
India imposes an average tariff of 37.7 per cent on US farm products, according to the Global Trade Research Initiative, while Indian agriculture products to the US face 5.3 per cent.
“We are all small farmers with small landholdings. Their farms are mechanised, ours are not. It is not a level playing field. So far the government position (on agriculture) is not clear,” said Mr Mohini Mohan Mishra, the All-India general secretary of the Bharatiya Kisan Sangh, a farmers’ body linked to the Rashtriya Swayamsevak Sangh (RSS). The RSS is the ideological backbone of the ruling party.
Beef with South Korea
For South Korea, one of the key concerns is Mr Trump’s unhappiness with Seoul over defence sharing.
He has complained that the South Koreans are not stumping up enough despite having agreed in November 2024 to pay 1.52 trillion won (S$1.4 billion) yearly – nearly 10 per cent more than the previous agreement. This falls short of the US$10 billion (S$13.1 billion) a year demanded by Mr Trump.
South Korean Deputy Prime Minister Choi Sang-mok and Trade Minister Ahn Duk-geun will lead a delegation to Washington for talks next week.
Seoul officials have said that they will present a comprehensive proposal including sector-specific tariff reliefs for cars, steel and semiconductors.
They will also offer to increase Seoul’s imports of gas, oil, agricultural products and weapons from the US, as well as propose increasing the production capacity of cars and semiconductors by South Korean companies in the country.
Bilateral cooperation in the shipbuilding industry and Seoul’s potential participation in the Alaskan LNG project will also be on the table. But Mr Choi, who is also Finance Minister, has said that defence payments “are not under review at the moment”.
He told a parliamentary meeting on April 15 that tariff negotiations with the US should not be rushed as “the very final decision will be made by the new government” to be formed after South Korea elects a new president on June 3.
The political turmoil means any concrete outcomes from next week’s tariff negotiations will be seen as “very optimistic”, said Dr Lee Seong-hyon, a senior fellow at the George H.W. Bush Foundation for US-China Relations.
He added that having Japan go first was a double-edged sword. It could help Seoul anticipate US demands but also undercut its position, especially if Tokyo concedes on agriculture or energy, he said.
“Crucially, a lack of pre-coordination between the two countries leaves them vulnerable to Washington’s ‘divide and rule’ play,” he added.
University of California San Diego’s assistant professor of economics Lee Mun-seob said that it could be more advantageous for South Korea to observe what comes out of the US-Japan negotiations and “delay finalising any tariff agreement for as long as possible”.
“The order of talks doesn’t necessarily dictate the order of agreements. These negotiations will take time, and by observing the outcome of US-Japan discussions, South Korea can better calibrate its own strategy,” he added.
Mr Ishiba said on April 14 that he wanted to work with other nations including other US allies, such as Britain, and regional countries in South-east Asia, on Mr Trump’s tariffs.
The issue of Mr Trump’s tariffs was raised during Mr Ishiba’s phone call with Singapore Prime Minister Lawrence Wong on April 14, during which Mr Ishiba said that he attaches importance to close communication with South-east Asia amid such challenging circumstances.
Dr Todo of Waseda University said it was crucial for Japan’s economic security and supply chain resilience to expand its trade relationships with other countries, including in the Global South, that will increasingly be large markets for Japan.
“Japan can provide policy support to lower informational and institutional barriers among countries in the Global South, and strengthen political ties by effectively utilising foreign aid, including infrastructure development and technical cooperation,” he said.
- Walter Sim is Japan correspondent at The Straits Times. Based in Tokyo, he writes about political, economic and socio-cultural issues.
- Nirmala Ganapathy is India bureau chief at The Straits Times. She is based in New Delhi and writes about India’s foreign policy and politics.
- Wendy Teo is The Straits Times’ South Korea correspondent based in Seoul. She covers issues concerning the two Koreas.
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