Former U.S. President Donald Trump announced on Tuesday that the United States and Japan have reached a new trade agreement that includes a reduced 15% tariff on certain Japanese imports, including automobiles. The announcement, made on Trump’s social media platform Truth Social, also claimed that the deal would result in $550 billion worth of Japanese investments in the U.S.
Trump said the agreement would open up greater market access for American products such as cars, trucks, rice, and various agricultural goods. However, the post did not clarify whether the longstanding 25% tariff on Japanese motor vehicles would be lifted. According to Japan’s public broadcaster NHK, the auto tariff would be lowered to 15%, citing an unnamed government official.
“This is a very exciting time for the United States of America,” Trump wrote, emphasizing the continued strength of U.S.-Japan relations.
Japan is one of the United States’ top trading partners, with two-way trade in goods reaching nearly $230 billion in 2024. Japan currently holds a $70 billion trade surplus with the U.S., according to data from the U.S. Census Bureau.
The announcement had immediate market impacts. Japanese automakers like Honda, Toyota, and Nissan saw stock gains of more than 6%, while U.S. equity futures also rose. The Japanese yen strengthened against the U.S. dollar.
Despite the bold claims, the White House did not issue an immediate response, and details of the deal remain unclear. Reuters was unable to confirm the specifics of the agreement.
In Tokyo, Japanese Prime Minister Shigeru Ishiba acknowledged receiving a preliminary report from negotiators but withheld comments until more details were available. Ishiba faces domestic political pressure following a major setback in the recent upper house election, where his ruling coalition lost its majority.
Separately, Trump also revealed a new trade agreement with the Philippines, featuring a 19% tariff on goods imported from the country and zero tariffs on U.S. exports.
The U.S.-Japan deal followed a meeting between Trump and Japan’s top tariff negotiator, Ryosei Akazawa, at the White House. Akazawa celebrated the conclusion of negotiations with a post on X, writing: “#Mission Complete.”
Kazutaka Maeda, an economist at Meiji Yasuda Research Institute, welcomed the lower tariff, saying it could help Japan avoid a recession. Kristina Clifton, a senior economist at Commonwealth Bank of Australia, noted that the deal appeared to be a better-than-expected outcome for Japan, given Trump’s previous threats of steep tariffs.
While automobiles remain a key component of U.S.-Japan trade—Japan exported over $55 billion worth of vehicles and parts to the U.S. in 2024 compared to just $2 billion in the other direction—Trump has long expressed frustration with what he views as a one-sided trade relationship.
Trump also expressed hope that Japan would invest in a gas pipeline project in Alaska, an initiative his administration has supported. Though initially skeptical, Japanese officials are reportedly warming to the idea as part of broader economic cooperation.
Trump’s team is racing to finalize multiple trade agreements ahead of an August 1 deadline. Without formal deals, countries could face additional tariffs. In recent weeks, Trump has announced trade frameworks with Britain, Vietnam, and Indonesia, and paused trade tensions with China—though details in many of those cases remain vague.
As with past announcements, Tuesday’s declaration came via social media following a private meeting, without a detailed joint statement from the foreign government involved. This approach mirrors Trump’s earlier declaration of a deal with Vietnam, for which no official documentation has yet been released.
