Japan Faces 30–35% Tariff Risk as Trump Doubts Deal
With a critical trade deadline fast approaching, President Donald Trump has signaled that a deal with Japan is unlikely, raising the prospect of imposing steep tariffs on Japanese imports. Trump indicated that unless an agreement is reached by July 9, the United States may levy tariffs ranging from 30% to 35%, up from the current 24% reciprocal rate.
Trade Deadline
The initial 24% tariff pause granted in April was intended to give both countries space to negotiate. However, Trump made it clear there will be no extension beyond the July 9 cutoff. The administration is preparing formal notifications for trading partners, warning of higher tariff regimes unless concrete agreements are signed.
Japan Tariff
Trump, speaking aboard Air Force One, remarked, “I doubt it,” when asked about the likelihood of a deal with Japan. He followed up by saying that Japan should be prepared for a tariff in the range of “30%, 35%, or whatever the number is that we determine.” The proposed tariffs are expected to impact key Japanese sectors like automobiles, steel, and agriculture, especially rice exports.
Negotiation Impasse
Japanese officials have pushed back firmly, refusing to yield on core demands. Chief Cabinet Secretary Yoshimasa Hayashi stressed that Japan would not compromise on protecting its domestic rice market or the current tariff structures shielding its auto industry. Tokyo remains insistent on legal guarantees and mutual safeguards, which remain stumbling blocks in the negotiation.
Market Reaction
News of the stalled negotiations sent ripples through Asian markets. The Nikkei 225 fell over 1%, while other regional indices also showed declines amid fears of a new trade standoff. Despite this, internal surveys suggest that more than 70% of Japanese manufacturers still consider the current tariff impact manageable—though an escalation could alter that outlook dramatically.
India Talks
While pessimism surrounds the Japan talks, Trump struck a more positive note on negotiations with India. He praised India’s approach, suggesting that a trade deal with New Delhi could be announced soon. U.S. officials believe India is showing greater willingness to cut trade barriers, particularly on agricultural and industrial goods.
