FOCUS: Trump shifts focus to Japan after trade truce with China
via KTIC (NE) - December 2, 2018
Now that U.S. President Donald Trump has reached a ceasefire with Chinese leader Xi Jinping over a trade war between their countries, Trump appears certain to shift his focus toward making a trade deal with Japan.
After signing a revamped trade pact Friday with Mexico and Canada on better terms for the United States, Trump agreed with Xi on Saturday to work to resolve issues such as forced technology transfer and intellectual property protection in exchange for suspending new U.S. tariffs on Chinese imports for 90 days.
Such developments on the fringes of a Group of 20 summit in Buenos Aires came as Washington prepares to start negotiations with Tokyo for a bilateral trade deal as early as in mid-January, with Trump determined to cut Japan’s trade surplus with the United States.
Advocating “fair” and “reciprocal” trade, Trump has called for reducing the U.S. trade deficit with trading partners such as China, Mexico and Japan — the first to third-biggest generators of goods trade deficit with the United States in 2017.
Under Trump’s “America First” mantra, addressing trade imbalances with these countries is one of the key agenda in his bid for re-election in the 2020 presidential race, especially after his Republican Party lost a majority in the House of Representatives in the Nov. 6 midterm elections.
In a meeting Friday with Japanese Prime Minister Shinzo Abe in Argentina’s capital, Trump called the U.S. trade deficit with Japan “massive” and “pretty substantial,” and said, “We hope that we’re going to be balancing it very quickly.”
While Japanese officials insist Tokyo and Washington aim for a bilateral trade agreement on goods only, U.S. officials have pushed for the inclusion of services and even a provision to prevent currency devaluations in an envisaged deal.
Analysts are watching how the Trump administration will balance its ambitions for a comprehensive pact like a free trade agreement with the U.S. agricultural industry’s thirst for a deal when other farming nations such as Australia and Canada are gaining greater access to the Japanese market through the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, an 11-nation FTA that will enter into force on Dec. 30.
Similarly, Japan and the European Union are speeding up domestic procedures for the early enforcement of an FTA, making American farmers and ranchers less competitive than their European counterparts in terms of access to the world’s third-largest economy...