Japan economy minister says ready to help small businesses once U.S. trade deal finalised

Japan economy minister says ready to help small businesses once U.S. trade deal finalised

Japanese Economy Minister Yasutoshi Nishimura said on Thursday that the government was prepared to help small businesses and farms depending on the outcome of trade talks with the United States, expected to be finalised and signed next week.

“We’re working on the negotiations now,” Nishimura told reporters in a briefing. “If necessary, we will make sure to support mid-size and small companies and farms,” depending on what is agreed with the United States, he added.

U.S. President Donald Trump said this week he had struck trade agreements with Tokyo but left unclear whether he had agreed not to impose threatened national security tariffs on Japanese vehicles and auto parts – a critical issue to Japan.

Trump and Japanese Prime Minister Shinzo Abe have said they hoped to sign an agreement at this month’s United Nations General Assembly in New York.

Trump’s announcement has left unanswered questions over whether the agreement would deliver Japan one of the main prizes of its negotiations: a U.S. pledge not to impose national security tariffs of up to 25% on Japanese vehicles and auto parts under Section 232 of U.S. trade law.

Japanese Foreign Minister Toshimitsu Motegi, who is in charge of talks with U.S. Trade Representative Robert Lighthizer, has said he wanted to reconfirm at the final stage of talks that the tariffs would not be imposed.

Full details of the agreement have not been disclosed. But Japan is expected to agree to cut tariffs on imports of U.S. beef and pork to within levels granted to signatories of the multilateral Trans-Pacific Partnership (TPP) pact, officials have said.

That would allow Trump to please U.S. farmers ahead of next year’s presidential election. The farmers had been disadvantaged in Japan’s market after the United States withdrew from TPP after Trump took office in 2017. It would also let Abe keep a pledge to domestic producers.

Japan is also expected to set a safeguard quota of about 240,000 tonnes of U.S. beef imports for the first year after the trade deal takes effect, the Mainichi newspaper reported on Thursday. That would cover most American beef imports, but the quota will likely increase to about 290,000 tonnes by 2033, the paper said.

Under TPP, Japan imposes a tax of 26.6% on beef imports up to around 600,000 tonnes annually and the rate goes up to 38.5% when imports surpass that amount.

Currently, Japan imposes a 38.5% tariff on U.S. beef imports and higher tariffs if accumulated quarterly imports of specific beef products rise more than 17 percent from the previous year.