Japan to Arm Wrestle the US About Tariffs….and What About Restrictions on Chinese Investments and Products?

The Financial Times, owned by Nikkei Inc, has as its main story today, Japan to maintain a better commercial agreement with us. The article describes how Prime Minister Shigeru Ishiba is in a corner. The story suggests that it really cannot prevent the United States rates or even necessarily negotiating a more complicated agreement that could allow Japan to live with its two points of conflict: 25% of tariffs in cars and cars. Requirement. And a requirement. Rice farmers have long been a very powerful group in Japan; I guess any other food interest is also influential.

As we will discuss below, the pink paper involuntarily represents the Japanese as a bit behind the plot. WHILE THE THREAT THREAT IS THE IMMEDIATE BLUDGEON TO FORCE COUNTRIES TO NEGOTE NEW TRADEMENTS WITH THE US, THE US IS SCHEMING TO PUT IN PROVISIONS, LIK Fard Be Fard Be Fard Be Fard Be Fard Be Fard Be Fard Be Fard Be Fard Be Fard Be Fard Be Fard Be Fard Be Fard Be Fard Be Fard Be far away. Prevails) of what the press seems to recognize. In the only agreement concluded so far, with the United Kingdom, the United States won the agreement to restrict investment (understood that China) in strategically important sectors, here of steel and pharmaceutical products. Michael Hudson confirmed the Chinese Conerns, who in the past has used concessions taken from a counterpart to the successful demand of others.

Remember that the non-Chinese-EV automotive industry is serious. I have written a little about the slow movement crisis in Nissan. Stellantis is in trouble. Volkswagen is closing factories in Germany. Toyota is in trouble. Ford and GM are in trouble. I could give details with each one, but you can easily verify the wide history with a search engine. Given what are great employers, all these companies and their suppliers (and how EVs are an additional threat by reducing the amount of necessary supplies), the reason is a national priority for countries with a non -trivial car to cling both to most of this.

Next to the key points of the Financial Times account:

Japan has pointed out that he is prepared to resist a better deal with the president of the United States, Donald Trump, in commercial tariffs, pressing the total elimination of his 25 percent duty in imports of Japanese cars instead of an internal political reaction …

Started by Prime Minister Shigeru Ihiba made the priority to arrive at the United States negotiating table ahead of other nations.

But the pressure of the business leaders and the members of the Istiba Democratic Liberal Party to reject any agreement that puts at risk the automobile sector or threats to national farmers who have forced him to recalculate …

Japan’s initial position remains the elimination of all new US rates, including a 25 percent tax in automotive imports, steel and aluminum and a “reciprocal” rate of 24 percent over other Japanese products that since then has been temporarily reduced to an “initial line” level of 24 percent …

Tokyo’s strongest sacrifices for Washington could be larger purchases of American agricultural products, greater access to the market for US cars and investment in a project of natural gas pipes liquefied in Alaska, officials said.

But with the elections of the Upper House of July that are coming, Ilhiba told Parliament that it will not sacrifice the national agricultural industry, also a great employer, to gain reservoir reductions for cars.

The article does not consult the fantasy among many that Japan would throw treasures (it could refuse to buy more, but that would take time to bite). In fact, the warning of the United States to Japan is along the reverse lines, not for week for Yen. Effecting that would mean large -scale purchase, not selling or financial assets in dollars.

It refers to the fact that Japan is a military protectorate from the United States. But could Japan get Stroopy yes/when the United States intensifies militarily with China? The United States would go to Japan for help. While it is unlikely that the Japanese say not, not, the Japanese are masters of the passive-agreesive breach, such as doing 40% less important than someone asked … slowly. But even so, that type of revenge would not help with current commercial conversations.

Now let’s go back to the possibility that foreign investment edges directed to China prohibit the support of particularly considered strategically important sectors. In the United Kingdom, that did not include cars. But Germany is trying to advance in the Bary plan to convert surplus car factories into tanks and armored vehicles. So that this scheme makes it colorable for the United States to try to verify Chinese rescues from car manufacturers with difficulties … what could be both for geopolitical favor and economic reasons.

It does not help Japan has announced a contraction of GDP before the tariffs arrived, and it was larger than expected.

In addition to that, Nissan’s terrible condition is likely to be more difficult for Japanese politicians to accept Trump’s automatic tariff rescue The fusion fell separate. More details comes in a new Bloomberg story:

Since the dramatic fall or its president of “Cost Killer”, Carlos Ghosn, in 2018, Nissan Motor Co. de Japan has worked under an alignment of aging models, a deficient cash flow and a management agitation.

For months, the automobile manufacturer has been resisting a financial savior and, despite the great hopes in early 2025 or joining forces with Honda Motor Co., the perspectives for an agreement collapsed, leaving their future in the air.

To complicate any hope of rapid change are the tariffs of President Donald Trump about imported vehicles, which represent almost half or the volume of US sales in Nissan.

On May 13, the automobile manufacturer published its sausage financial results in 25 years and announced a restructuring plan that includes closing factories and reducing 20,000 jobs in an attempt due to voice assembly losses …

The company expects sales in the US, its largest single market, decrease this year even before the impact of tariffs is taken into account. As a result, it has too many cars and not enough buyers. Or as Nissan himself declared too clearly in his most recent presentation of investors: “Fixed costs remain higher than current income can support.”

The BBC has just reported a Chinese state company considering what the Japanese call a link in Nissan’s pieces:

The Nissan car manufacturer says he is open to sharing factories worldwide with his Chinese state partner Dongfeng while shaking his business.

The Japanese firm, which uses thousands of people in the United Kingdom, told the BBC that it could lead to Dongfeng “to the Nissan production ecosystem worldwide.”

Nissan’s own brands have struggled to make roads to China, which is the world’s largest automotive market, since the hard competition has led to the prices of fingers.

He has associated with Dongfeng controlled by Beijing for more than 20 years and currently work together to build cars in the Chinese city of Wuhan.

So, the two companies have a pre -existing relationship. But this proposed agreement can eliminate to what extent the Trump administration is intended to bring its scheme to restrict foreign direct investment.

The closure of the history of Financial Times mentioned above indicates that Japan may not be able to do much to give Trump’s team plans:

“The problem Japan has to, in principle, does not want an agreement that is affected by speed, but at the same time it cannot trust the idea that the United States has patience for a sophisticated agreement,” said the official knowledge of the conversations.

Stephen Nagy, a professor of international policy and studies at the Christian International University of Tokyo, said that ishiba’s strategy was based on the idea that the United States valued its security association on tariffs.

“I think Japan will realize that Trump is committed to a baseline or tariffs,” Nagy said. “It doesn’t matter what you do or say, Japan can’t escape this.”

And on a completely different front, the USA. Trying to use export controls to create “Vassals AI”:

Needless to say that Trump’s commercial matrix is ​​still very moving. And let’s not forget that their reference tariffs or 30% in China and 10% in all others will have an impact on American consumers and, therefore, also in exporters, as confirmed by the warning of prices induced by the Walmart rate. In addition, more parochial, it remains to be seen that the Asian countries of Howeheads can adequately satisfy the US. At the end/severely restricted China’s transbors to be subject to level rates close to China. Stay tuned.