Trump, Japan strike deal to slash tariffs on US farm goods, boost digital trade

President Trump and Japanese Prime Minister Shinzo Abe announced Wednesday that the nations had reached agreements on agricultural and digital trade provisions of a broader deal between the U.S. and Japan.

The agreement, finalized and touted by Trump and Abe at the United Nations summit, would eliminate or reduce tariffs on $7.2 billion in U.S. agricultural goods imported by Japan. 

The deal would also reduce import taxes and other trade barriers for digital products — such as software, digital media, computer source code and data — exchanged between the U.S. and Japan.

The agreement reached by Trump and Abe on Wednesday does not cover a slew of other contentious trade issues, including Trump’s threatened foreign auto tariffs, weighing on the two nations’ trade relationship.

U.S. Trade Representative Robert Lighthizer said Wednesday that while autos are “not part of this agreement,” he suggested that issue could be tackled among others in a “second phase” of talks toward a comprehensive deal.

Lighthizer added that “it is certainly not our intention, the president’s intention,” to levy tariffs on Japanese autos.

Even so, Trump and Abe showered each other with praise during a Wednesday ceremony and projected optimism that they would reach a full, final deal soon.

Trump called the measure a “huge victory for America’s farmers, ranchers and growers, and that’s very important to me.”

Abe, speaking Japanese, said through an interpreter that the deal was a “win-win” for both nations that will “further galvanize the investment between the two sides” and “deepen our economic relations.”

A major component of Wednesday’s agreement is a significant expansion of access to the Japanese market for U.S. farmers and ranchers. Under the deal, Japan agreed to lift or reduce tariffs on $7.2 billion of the $8.9 billion in U.S. agricultural exports subject to Japanese tariffs.

Japan is set to reduce tariffs on $2.9 billion in U.S. beef and pork, and eliminate tariffs on more than $4.3 billion in U.S. nuts, berries, grains, wine, cheese and other animal products. Japan will also agree to import annual quotas of wheat and wheat products, malt, glucose, fructose, corn starch and potato starch.

“If we had not done this, the United States agriculture would be at a disadvantage to TPP countries and some European countries,” Lighthizer said, referring to the Trans-Pacific Partnership, the Obama-era trade deal that Trump abandoned in 2017. 

“This gets us equal or better than those people,” he added.

Republicans and pro-trade groups praised the agreement as much-needed relief for the ailing U.S. farm sector, which has suffered under tariffs issued by China in response to Trump’s levies on Chinese goods.

“While we look forward to seeing the full text of the final agreement, this is a step in the right direction,” said Farmers for Free Trade, a coalition of agriculture trade groups opposed to tariffs. 

“Our farmers need trade wins, not trade wars. We hope this new agreement leads to more wins, as well as progress in achieving a better trade relationship with China,” the group stated.

Sen. Ron Wyden (D-Ore.) offered measured praise for the agreement, praising the accord on digital trade while expressing concerns about the depth of the agriculture provisions.

“The agriculture deal is not a comprehensive one and there is much more to do to level the playing field in Japan for American workers, businesses, farmers and ranchers,” said Wyden, ranking Democrat on the Senate Finance Committee, which covers trade policy.

“I look forward to this administration moving quickly to address the remaining trade issues our country faces in Japan,” he said.

Morgan Chalfant and Brett Samuels contributed.