The United States and Japan have agreed on the first stage of a new trade deal that will eliminate tariffs and expand market access on farm, industrial, and digital products.
President Donald Trump and Japanese Prime Minister Shinzo Abe signed the deal on the sidelines of the U.N. General Assembly on Wednesday, 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.
Japan, which imports U.S. farm products worth $14 billion, is America’s third largest market.
“We have successfully covered a wide range of areas, including not only the industrial goods, but also the agricultural products and also the digital trade between the two sides,” Abe said.
The president said Japan will open new markets to approximately $7 billion in U.S. agriculture products and tariffs would “now be significantly lower or eliminated entirely” on American beef, pork, wheat, cheese, corn, wine, and more.
“This is a huge victory for America’s farmers, ranchers, and growers, and that’s very important to me,” he asserted.
The deal also covers commitments on $40 billion in digital trade between the countries, “which will greatly expand commerce across cutting edge products and services.”
Gov. Kim Reynolds of Iowa praised the agreement as it “brings much-needed stability to Iowa’s ag economy.”
“President Trump’s U.S.-Japan Trade Agreement is a decisive victory for Iowa farmers,” she said in a statement. “I look forward to leading a trade mission to Japan later this year and building an even stronger relationship with this important trading partner.”
Reynolds also urged Congress to pass the U.S. Mexico Canada Agreement (USMCA) to expand and open new markets for U.S. producers.
“Congress must now take the next step to officially ratify USMCA and build on the success President Trump has secured today for Iowa and the country,” she said.
Japan is a key export market for Iowa. Last year, Iowa exporters shipped $491 million in corn products, $370 million in pork products, and $135 million in beef products.
Japan is one of the largest export markets and trading partners for the United States. In 2018, U.S.-Japan trade in goods and services surpassed $300 billion, U.S. goods and services exports reached a total of $121.1 billion, increasing 6 percent from 2017, according to the Export.gov.
Includes reporting from the Associated Press