Washington: Former US President Donald Trump has announced what he described as the “largest trade deal ever” with Japan, claiming the agreement is worth $550 billion and would overwhelmingly benefit the United States. In a post on Truth Social, Trump said Japan would invest the massive sum into the US economy, asserting that America would secure 90% of the profit. He also stated that the deal would create hundreds of thousands of jobs across sectors.
Later at a Republican reception, Trump reiterated the scale of the agreement, though official documents detailing the terms are yet to be released by either government. According to sources, the agreement includes a 15% reciprocal tariff on Japanese imports and expanded market access for US exports, including rice, automobiles, and other agricultural products.
The deal also addresses longstanding trade tensions, especially regarding Japanese restrictions on US rice and high tariffs on American-made cars. Japanese Prime Minister Shigeru Ishiba confirmed that as part of the agreement, Japan will reduce its auto tariffs by 15%. Despite Trump’s claim that Japan had not bought a single US car in a decade, official data indicates that over 16,700 American vehicles were imported by Japan in 2024 alone.
Japanese officials clarified that the agreement does not include any commitments related to defence spending, countering speculation that military terms were attached to the deal. Following the announcement, Japan’s Nikkei 225 index jumped by 2%, and shares of major automakers like Toyota, Honda, and Nissan also saw gains. US Treasury Secretary Scott Bessent called the deal “mutually beneficial,” while trade experts remain cautious about the finer details.
With no formal documentation or fact sheet made public yet, both markets and analysts await further clarity on the agreement’s implementation. Japan, which exported $148 billion worth of goods to the US last year, is the largest foreign holder of US debt and a critical player in Washington’s strategy to reduce dependency on Chinese supply chains.