Ishiba, Trump fail to reach pact on tariffs

Japan and the United States have yet to reach a tariff agreement, with key differences still unresolved. Experts warn that the unpredictability of US trade policy could harm Japan's economy and increase global instability.

On the sidelines of the G7 summit on Monday in Canada, Japanese Prime Minister Shigeru Ishiba met US President Donald Trump for 30 minutes and urged a review of the tariffs imposed on Japan.

"There are still areas where our views do not align," Ishiba said after the meeting, noting that no comprehensive deal had been reached and declining to reveal specific points of disagreement. He said it is difficult to set a timeline, as national interests must be protected.

This was the leaders' second in-person meeting since Ishiba visited Washington in February. Ishiba reaffirmed Japan's intent to expand investment in the US, emphasizing the importance of a mutually beneficial relationship. However, Trump made no commitment to easing tariffs on automobiles or other goods.

Currently, Japanese exports face 25 percent US tariffs on automobiles and parts, 50 percent on steel and aluminum, plus a 24 percent "reciprocal" tariff. Despite six rounds of ministerial talks, the US remains reluctant to lift tariffs on automobiles — a key concern for Tokyo.

The US is Japan's largest car export market, and according to forecasts by Nomura Securities, the imposition of auto tariffs by the US could push Mazda into the red and slash Toyota's operating profit by about 30 percent.

Hidetoshi Tashiro, chief economist at Japanese consultancy Infinity LLC, warned that the earnings of Japanese automakers will deteriorate due to US tariff hikes, thereby affecting the Japanese economy.

"The targets and criteria of US tariffs could change arbitrarily, and the US tariff policy is inherently unpredictable," Tashiro said. "As a result, both foreign and domestic US companies will find it difficult to make reasonable business plans, and the global economy will face even greater uncertainty."

He noted that the international community widely believes the US' overuse of tariffs will harm all economies involved — and that, in the end, the United States itself will bear the consequences.

Kazuyuki Hamada, an international political economist and Japan's former parliamentary vice-minister for foreign affairs, said: "With the Upper House election fast approaching, the Japanese government had hoped to secure at least a partial rollback of the 25 percent auto tariffs imposed by Trump. …However, the 30-minute meeting ended in disappointment, yielding only an agreement to continue ministerial-level talks."

Despite Ishiba's firm declaration that the auto industry is the very core of Japan's national interest and the government will use every means available to win concessions from the US, he failed to sway Trump's position.

Hamada also pointed out that Ryosei Akazawa, Japan's lead tariff negotiator, has visited the US six times in the past two months for talks with Trump administration officials, raising concerns about a troubling lack of understanding of US political dynamics on Japan's part.

"The fruitless outcome of this latest Japan-US summit will likely result in a harsh judgment from voters in the upcoming Upper House election. Ishiba is scheduled to meet Trump again at the NATO summit on June 24 — but unless Japan can prepare a compelling offer that truly grabs Trump's attention, it's unlikely anything will change," he said.