Image reproduced from 中時新聞網

According to a report from The Wall Street Journal, President Trump announced a 25% tariff on Japanese goods that will take effect on August 1. The Japanese government has stated that it will not easily compromise and has pledged to continue negotiations with the U.S. to protect national interests. Prime Minister Shigeru Ishiba and several cabinet officials emphasized on August 8 that they will not accept unfair conditions and will strive for a trade agreement acceptable to both sides.

Ishiba stated, "The Japanese government will not make reckless concessions. We will defend our interests and present our claims while fully committing to negotiations." He also pointed out that Japan will effectively utilize the time until early August to enhance discussions with the U.S. and strive for a result that aligns with Japan's national interests and benefits bilateral economic ties.

The automotive tariffs have become the biggest obstacle. Despite a certain level of mutual trust established in past negotiations between the U.S. and Japan, many critical issues remain unresolved, particularly regarding the U.S. tax policy on Japanese automobiles. Japan's Minister of Economy and lead negotiator Ryosei Akazawa revealed that he had a 40-minute conversation with U.S. Secretary of Commerce Howard Lutnick to discuss issues including trade expansion, non-tariff barriers, and economic security, but the automotive tariffs remain a tough challenge.

Akazawa stated, "The automotive industry is a core industry for Japan, and if we cannot reach an agreement on automotive tax rates, it will not be possible to sign an overall trade agreement." Automobiles account for about 30% of Japan's exports to the U.S. and are crucial to employment and the industrial lifeline, thus Japan insists there can be no concession.

According to a document published by Trump on Truth Social, the U.S. emphasized that the 25% tariff rate is still below the level needed to offset the U.S.-Japan trade deficit, stating that if Japan or Japanese companies are willing to adjust their trade behaviors, there may be a future reduction in the tariff rate. Additionally, it clarified that "reciprocal tariffs" will not overlap with existing specific industry tariffs (such as those on automobiles and steel).

The Japanese side is vigilant to the economic impact, and Minister of Finance Katsunobu Kato has pledged to monitor the economic effects of U.S. tariffs and provide financial assistance as necessary to ensure smooth capital operations for affected companies. He also noted that Japan will not purchase U.S. goods that do not meet domestic standards and interests, reflecting Japan's commitment to safeguarding its domestic market principles.

Analysis by BMI, a unit of Fitch Solutions, suggests that if negotiations ultimately do not lead to a significant reduction in automotive tariffs, Japan is unlikely to sign the agreement. This implies that negotiations will continue to be deadlocked, leaving investors and businesses uncertain about future tax burdens.

Recently, Trump has repeatedly pressured Japan, accusing Tokyo of not purchasing enough U.S. rice, and claiming unfairness in automobile trade, even threatening that future tariff rates could rise to 30% -35%. However, Japan's high-ranking officials remain steadfast, stating, "We will never yield on our non-negotiable national interests."