World Economy

Trump, Abe Agree to Disagree on Trade

Donald Trump (L) and Shinzo Abe at the Akasaka Palace, Nov. 6, in Tokyo.Donald Trump (L) and Shinzo Abe at the Akasaka Palace, Nov. 6, in Tokyo.

The US trade deficit with Japan has been a cause of division between the two leaders, even as they continue talks to make progress on the US-Japan alliance.

Even best friends are bound to have their disagreements, and Japanese Prime Minister Shinzo Abe and visiting US President Donald Trump are no different, ANN reported.

The prickly issue of trade has divided both leaders time and again–Nov 6 was no different, even as they vowed to move forward on the US-Japan alliance.

Trump lashed out at the United States’ trade relationship with Japan in a meeting with businessmen Monday, saying that Japan has been “winning” for decades at the expense of the US. “We want fair and open trade, but right now our trade with Japan is not fair and open,” he said.

He cited the “many millions of cars sold by Japan in the US, whereas virtually no cars go from the US into Japan”.

The US trade deficit with Japan last year came up to $68.9 billion, and Trump called for a “fair, open and reciprocal trade relationship”. Trump hopes to move forward with a bilateral free trade agreement with Japan, a task left to their deputies to iron out through a bilateral economic dialogue.

Abe focused more on the need to establish a rules-based economic order in the Indo-Pacific. Skirting a question on Trump’s comments about Japan trade, Abe said the “question about the economy is not restricted only to bilateral trade, but also (covers) the entire region”.

“The making of high standard rules is something we want to pursue, and we will make efforts to create a broad economic order in the Indo-Pacific that is fair and effective,” he said.

He had noted that the US and Japan–as the largest and third-biggest economies in the world–make up about 30% of the world economy and share values such as freedom and fairness.

If Abe’s comments sound familiar, it is because they contain echoes of the Trans-Pacific Partnership deal, which was hailed as the gold standard of free trade pacts. Its focus lies in not only breaking down trade restrictions but also ensuring fair competition.

But the TPP is one issue over which the two disagree. In one of his first acts after taking office in January, Trump pulled the US out of the TPP. Japan now takes the lead among the remaining 11 nations, including Singapore, on the pact.

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