US President Donald Trump revealed a new trade agreement with Japan on Tuesday, which he described as “massive.” The deal includes a 15% tariff rate and promises major Japanese investments in the United States.
Trump shared the news on Truth Social, claiming the agreement would bring in $550 billion in investments from Japan. He said, “Japan will invest, at my direction, 550 billion dollars into the United States, which will receive 90 per cent of the profits. This deal will create hundreds of thousands of jobs — there has never been anything like it.”
According to Trump, the deal opens up Japan’s market to a range of American goods. These include automobiles, trucks, rice, and other agricultural products. He emphasized, “Perhaps most importantly, Japan will open their country to trade — including cars and trucks, rice, certain agricultural products, and other items.”
Trump said the agreement also includes a 15% reciprocal tariff, meaning Japan will match US tariff levels. “Japan will pay reciprocal tariffs to the United States of 15 per cent,” he added.
The announcement came soon after Trump held a meeting at the White House with Ryosei Akazawa, Japan’s top trade negotiator. This meeting likely helped seal the final terms of the deal.
Trump originally wanted a 25% tariff, but the final agreement lowered it to 15%. Despite this reduction, Japan had previously pushed for a complete exemption from US tariffs. Now, the new tariff is set to be enforced starting August 1, alongside similar measures aimed at other major economies.
Earlier in the week, questions about the deal’s future emerged after Japanese Prime Minister Shigeru Ishiba’s party suffered losses in the upper house elections. The setback created doubts about Tokyo’s ability to follow through on the agreement.
It is still uncertain whether this 15% tariff will be added on top of Trump’s previously suggested tariffs—25% on automobiles and 50% on steel. These sectors are vital to Japan’s economy and have been major points of tension in US-Japan trade talks.
