The United States and Japan signed two new trade agreements on Monday, Oct.7, one on agricultural exports and another on digital trade.
The two agreements will help create jobs, expand investment, reduce our trade deficit, and promote fairness. These agreements will provide a tremendous boost to American farmers, workers, and businesses, according to the White House.
“This is a huge victory for America’s farmers, ranchers, and growers. And that’s very important to me,” President Trump said in a signing ceremony at the White House.
According to the new agreement, Japan will eliminate or reduce tariffs on approximately $7.2 billion in United States agricultural exports. The world’s third-largest economy will remove or significantly lower tariffs on American beef, pork, poultry, wheat, cheese, wine, ethanol, and more.
Once this agreement is implemented, over 90 percent of United States agricultural imports into Japan will be duty-free or receive preferential tariff access. Japan, which imports U.S. farm products worth $14 billion, is America’s third-largest market.
The Trump administration has increasingly sought to appease farmers, following broader tariff disputes with China. President Trump has found support in calls to address Chinese trade practices seen as unfair.
“Bigger picture, as we sign these deals with our largest trading partners—Japan, USMCA, EU—it puts increasing pressure on China to ink a deal with us,” said Dave Walton, a soybean farmer in Iowa. “They do so by making China see them as competitors for our trade,” according to Business Insider.
Besides, President Trump is also working on expanding the vital digital trade between the United States and Japan. The United States-Japan Digital Trade Agreement includes high-standard provisions that address key digital trade issues.
This agreement will boost the already approximately $40 billion worth of digital trade between the United States and Japan.
The deal would promote competition in creative products and services where the United States is a world leader and will ensure that American companies have a level playing field in fields such as film, music, e-books, and technology.
Earlier, President Trump and Japanese Prime Minister Shinzo Abe have agreed on the first stage of this trade deal, Sept. 25. The president called it the “first stage of a phenomenal new trade agreement” and described it as “outlining the significant steps we’re taking toward a fair and reciprocal trade agreement.”
“This is a big chunk, but in the fairly near future we’re going to be having a lot more comprehensive deals signed with Japan,” President Trump said.