Ishiba Vows to Remain PM After U.S. Lowers Tariffs
Japanese Prime Minister Shigeru Ishiba has reaffirmed his commitment to remain in office following a U.S.–Japan trade agreement that reduces auto tariffs to 15%, down from the previously threatened 25%. The pact, announced on July 22, also includes a pledge by Japan to invest about $550 billion in the U.S., although some of the funds had been previously promised. The tariff cut applies broadly and diverges from earlier U.S. proposals of selective, sector-specific tariffs.
Confusion Over Tariff Details
The agreement has generated confusion in Tokyo due to conflicting interpretations of whether existing tariffs remain in place. Japan’s lead negotiator later said Washington agreed to Japan’s reading that the 15% tariff replaces previous levies, but the White House has not publicly confirmed this.
Domestic Political Pressure
Strong domestic pressure followed the ruling coalition’s recent defeat in the upper-house election, where Ishiba’s Liberal Democratic Party lost its majority. Despite the setback, Ishiba remains in power. He has instructed ministers to craft an economic stimulus package—possibly including cash handouts—and plans to present it in a fall parliamentary session.
BOJ’s View on Tariffs
Bank of Japan Deputy Governor Ryozo Himino commented that the U.S. tariffs reflect political motivations beyond economics, signaling a broader strategy by the Trump administration that challenges conventional trade norms.
