Trump Gave the Japanese Prime Minister a Break on Trade, For Now
President Donald Trump did Japanese Prime Minister Shinzo Abe a favor last week, delaying the start of negotiations on a tricky trade decision, potentially pushing it past that country’s elections in July, three officials briefed on the talks tell TIME.
Trump has said repeatedly that he values his relationship with Abe, and his decision to ignore the advice of Special Trade Representative Robert Lighthizer that the two negotiate on Japanese auto exports and U.S. agricultural products during their meeting last week is a reflection of that personal touch.
Still, Trump has not let go of his threat to impose a 25% tariff on Japanese autos if the country doesn’t open its market to more U.S. beef and other agricultural products. The delay could end up postponing the decision until after elections this summer for the upper house of the Diet, Japan’s parliament, but the Trump Administration’s public line is that they are moving ahead.
During the April 26 meeting with Abe, Trump said that he hopes the trade talks will “go quickly” and suggested that his Administration aims to negotiate an autos-for-agriculture deal with Japan by the time he visits Tokyo in late May to meet the new Emperor Naruhito, who will succeed his father Akihito.
However, officials from both countries tell TIME that although Lighthizer pressed for a quick agreement from Japan to eliminate its steep tariffs on U.S. farm products, negotiators have made little or no progress on framing such a deal.
The White House declined to comment.
Read More: Japan Has Big Plans for a U.S. Summit. But Trump Just Wants to Talk Cars and Military Costs.
Although the House of Councillors has little power, Japan’s farm lobby has a great deal, and making any concession on beef and other products without getting something in return would weaken Abe and his Liberal Democratic Party, especially if elections for the more powerful lower house of the Diet are also scheduled for July.
While the delay may take some of the heat off Abe for now, the two nations remain divided over the shape of any agreement.
Japanese negotiators are continuing to press in the short term for a bilateral deal in which Japan would open its market to U.S. farm exports in exchange for the Trump administration abandoning its threat to raise tariffs on Japanese autos and auto parts.
Led by Lighthizer and Treasury Secretary Steven Mnuchin, U.S. officials have continued to demand that Japan must abandon what Trump repeatedly has called its unfair trade practices or face tariffs on its auto exports to the U.S. that trade experts last year calculated would add some $2,000 to the cost of Japanese compact cars such as the Toyota Corolla and Honda Civic,
But while Trump is facing a May 18 deadline to decide on the auto tariffs, he could delay a decision by as much as 180 days if negotiations are continuing or take other steps to keep the threat alive.
Japan would prefer a more extensive deal that would include the gradual elimination of U.S. tariffs on Japanese steel, aluminum, and light trucks that would have been phased out if the U.S. had remained in the 12-nation Trans-Pacific Partnership trade agreement, which Trump abandoned in favor of trying to negotiate separate bilateral deals with Japan, China, South Korea and other nations.
A broader deal, however, still remains out of reach, said officials from both nations, and delaying any action on a more modest one risks increasing the danger that Trump’s other priority — demanding that Japan contribute more to supporting the cost of U.S. forces based there —could become ensnared with the trade talks.
With Tessa Berenson and Justin Worland in Washington