Posted on 04 Apr 2025
Japanese Prime Minister Shigeru Ishiba said Thursday that he is “extremely disappointed” that Washington went ahead with unilateral tariff measures despite Tokyo’s review requests.
On Wednesday, US President Donald Trump unveiled that Japan’s imports to the US will face a 24% “reciprocal” tariff. Japanese cars and certain auto parts will be exempted from this rate, given they already face a new 25% levy as of 3 April. The newly announced tariffs will come into effect between 5 and 9 April.
Speaking in a press conference monitored by Kallanish, Ishiba said his cabinet and officials will prepare to take measures to support its domestic industries, and that he would not hesitate to talk to Trump directly “if appropriate.”
“Japan has been the world’s largest investor in the United States since 2019. Japanese companies have played a major role in the US economy, and continue to do so today,” he says. “Japanese carmakers have made direct investments of approximately JPY 61.6 billion [$420.7 billion] in the United States, and have created 2.3 million jobs. It’s no exaggeration to say that they are the largest in the world.”
“We will continue to strongly urge the US to review the measures,” he adds, noting that Japan has “serious concerns” about the consistency of the tariffs with the World Trade Organization agreement and the Japan-US trade agreement.
Japan’s trade ministry METI says it will “advance negotiations” to seek exemption from the tariff measures and establish a “US tariff headquarters” within the ministry to assess the impact and “promptly” implement domestic measures. It notes the automotive industry is the “backbone of Japan’s industry,” accounting for 20% of domestic shipments, and has an extensive supply chain including parts manufacturers.
As a short-term response, Tokyo announced four measures. It will establish a special consultation desk focused on the automotive industry to evaluate the impact of car-specific tariffs plus the 24% duty on all other goods that may be part of the value chain.
It’s also relaxing requirements for safety net loans provided by the Japan Finance Corporation and other financial institutions, and expanding support scope to include businesses affected by the additional tariffs on auto and other products.
Additionally, it will start a public and private consultation focused on small and medium-sized enterprises to prevent serious disruptions to their cash flow. Nippon Export and Investment Insurance (NEXI) will also step in to help with the procurement of working capital to meet the capital needs of Japanese subsidiaries operating in North America and other countries that are affected by the tariffs.
“Losses caused by tariff measures will be covered by export insurance,” METI says, noting further details will be unveiled later by NEXI.
Trump said Japan and other nations impose “colossal trade barriers” to US companies.
“94% of the cars in Japan are made in Japan. Toyota sells 1 million foreign-made automobiles into the United States and General Motors sells almost none. Ford sells very little. None of our companies are allowed to go into other countries,” he claims. “And I say that friend and foe, and in many cases, the friend is worse than the foe in terms of trade.”
Source:Kallanish
