Worried that new tariffs will affect 550 billion in cooperation, Japan urgently contacts the U.S. to draw a red line: Trade agreements must not go backwards!

U.S. Tariff Policies Continue to Fluctuate, Japan Calls on the U.S. to Ensure New Tariffs Do Not Impose Stricter Trade Conditions Than Last Year’s Agreement

On February 24, Bloomberg reported that on Monday, Japanese Economy Minister Akazawa Ryosei had a phone call lasting about 40 minutes with U.S. Commerce Secretary Howard Lutnick. The Ministry of Economy, Trade and Industry of Japan later stated that Akazawa clearly expressed: As the U.S. introduces new tariffs, Japan’s trade conditions should not be worse than the benchmarks established in last year’s Japan-U.S. agreement. Both sides also confirmed they will maintain close cooperation to promote the implementation of projects under the $550 billion investment mechanism.

This negotiation took place against the backdrop of the U.S. Supreme Court ruling last week that Trump’s tariffs were unconstitutional. The White House immediately announced new 10% tariffs starting this Tuesday, with Trump later threatening to raise the rate to 15%.

According to Xinhua News Agency, President Trump posted on social media on the evening of the 20th that he had just signed an executive order imposing a 10% tariff on goods from all countries and regions, “which will take effect almost immediately.” Japan is concerned that some goods already subject to specific tariffs under last year’s agreement may face additional burdens due to the new tariffs.

New Tariffs Raise Concerns in Japan Over Agreement Terms

Under the U.S.-Japan trade agreement reached last year, Japan committed to investing $550 billion in the U.S. through a fund called the “U.S./Japan Investment Tool,” in exchange for the U.S. lowering tariffs on Japanese auto imports from 27.5% to 15%.

Akazawa Ryosei stated at a routine press conference on Tuesday that some goods already subject to a non-cumulative 15% tariff under last year’s agreement might face cumulative burdens due to the new tariffs. He reiterated that the government will continue to communicate with the U.S. to ensure Japan does not end up in a worse position because of the new tariffs. Akazawa did not disclose Lutnick’s specific remarks during the call and said there are no current plans to continue negotiations in the U.S.

On the surface, the latest moves by the White House may not impose more severe conditions on Japan. The reciprocal tariffs on Japanese products are locked at 15%. If the new tariffs imposed under the 1974 Trade Act Section 122 are also set at 15%, Japan’s overall effective rate remains unchanged. However, given the high uncertainty during previous tariff policy implementations, Japan remains highly alert this time.

Officials Emphasize Agreement Implementation and Reject Restarting Negotiations

In response to ongoing turbulence in U.S. tariff policies, Japan’s Chief Cabinet Secretary Kihara Toshiro on Tuesday stated that the government will continue steadily implementing the existing trade agreements and closely monitor subsequent developments’ impact on the agreements.

Former Defense Minister and current Liberal Democratic Party Tax System Investigation Committee Chairman Onodera Goto said on Sunday on Fuji TV that the current U.S. tariff situation is “a mess.” However, he explicitly opposes restarting negotiations on the U.S.-Japan trade agreement.

He pointed out that, the core issue of last year’s trade deal was to reduce auto tariffs, which are vital to Japan’s largest export pillar—automobile industry, affecting employment and investment. He stated:

“If trying to renegotiate causes auto tariffs to be affected, it would be a lose-lose situation.”

Advancing Investment Projects and Maintaining Bilateral Cooperation Framework

Regarding the investment mechanism, Trump announced last week the first batch of projects, including data infrastructure, deep-sea oil terminals, and a synthetic diamond manufacturing plant for semiconductors. All announced projects are currently located within the United States.

The Ministry of Economy, Trade and Industry of Japan stated that both sides reaffirmed their commitment to continue advancing the trade agreement with integrity and speed. Akazawa Ryosei and Lutnick also reached a consensus during their call to accelerate the progress of projects under the $550 billion investment mechanism.

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