It took about two years for Japanese prime minister Shinzo Abe to nod “Yes” following repeated “No” to agree for a bilateral trade deal with United States. The negotiations turned up favoring both the nations on Wednesday during meetings at the United Nations General Assembly in New York.
Japan was always interested, and repeatedly invited US, in a broad trade pact involving eleven countries, but President Trump had withdrew from it immediately after assuming to office.
Lately the Trump administration has imposed tariffs on many products imported from China with warning the same move would be taken for other countries too. Japan seems to have acquiesced to the pressure that may result with tariffs on their cars. This led Abe to enter into a two-way negotiation.
Meanwhile, a left-leaning Japanese daily tabloid, The Asahi Shimbun, called Abe as a traiter and the country has been chased into a corner.
An expert on Japanese politics at Teneo Intelligence in Washington, Tobias Harris, said for the American officials it is just like indulging in some sort of deal and see what comes out of Japan in short term before moving onto other things. For Japan it is nothing more than some immediate breathing room from the threat of tariffs.
Industry analysts view the profits of auto manufacturers could be reduced by 2.2 percent if tariffs of 20 percent are imposed. The car exports would decline by 200,000 units if the costs are passed on to the customers.
Some of the analysts suggest Abe has played diplomatically but has also given the appearance of compromising.
Amid trade war with China the US is also having difficult trade negotiations with Canada. Trump is facing domestic challenges and midterm elections are just ahead. The talks with Japan may however provide a small-but-quick win to the officials. Japan will now be a new victory for all the efforts exercised in getting countries to buckle on trade.
For Abe, he is paving his way to become the longest-serving prime minister of Japan following his recent election win. Briefing to the press Wednesday evening in New York he said US may open up markets for vegetables, beef and other agricultural products.