'Massive' trade deal signed between US and Japan

The United States and Japan, two of the world’s largest economies, have signed a ‘massive’ trade deal. US President Donald Trump described the agreement as 'possibly the biggest trade deal in history.'

According to the BBC, Trump announced the deal at an event held at the White House in Washington on Tuesday. He said, “This deal benefits both countries. We have worked on it for a long time, and I have always said that a deal must be fair to both sides.”

Under the agreement, Japan will invest \$550 billion in the United States. Also, American agricultural products, cars, and other goods will gain better access to the Japanese market. Trump added that Japan has agreed to impose a 15 percent retaliatory tariff.

Japan’s chief trade negotiator, Ryosei Akazawa, said on social media, “The mission is complete after the talks at the White House.” However, the full details of the deal have not yet been made public. International media are contacting Japan’s embassy in Washington for more information.

Before signing the deal, there was some tension between the two countries. Earlier this month, Trump warned that if no agreement was reached by August 1, a 25 percent tariff would be imposed on Japanese goods. Earlier in April, he had planned a 24 percent tariff but later postponed it for 90 days.

The US policy called “Liberation Day” included the unilateral imposition of tariffs on some countries, affecting the global trade market. In this context, the deal with Japan is expected to help reduce tensions.

The announcement of the deal also had a positive effect on the markets. Japan’s Tokyo stock market saw the Nikkei 225 index rise by nearly 2 percent. Shares of major car makers like Toyota, Nissan, and Honda increased significantly.

Meanwhile, Trump also said another trade deal with the European Union will be announced soon. Talks are also ongoing with several other countries.

Analysts believe the deal is important for Japan’s internal politics as well. In the recent election, the Liberal Democratic Party lost control of the upper house. The party leader and Prime Minister Shigeru Ishiba did not directly comment on the deal. He said, “It is better not to comment until a full analysis is completed.”