WASHINGTON: US President Donald Trump has announced a “massive” trade deal with Japan, as China said it would send its vice premier to US trade talks next week to secure its own agreement ahead of a looming deadline.

In an attempt to slash his country’s trade deficits, the US president has vowed to hit dozens of countries with punitive tariff hikes if they do not hammer out a pact with Washington by August 1.

The Japan agreement, along with another pact with the Philippines also announced on Tuesday, means Trump has now secured five agreements since his administration promised “90 deals in 90 days” from April’s tariff delay.

The others are with Britain, Vietnam and Indonesia, which the White House said would ease critical mineral export restrictions. Negotiations are still ongoing with much larger US trading partners China, Canada, Mexico and the European Union.

Japan to invest $550bn in United States, says Trump

Representatives from China and the United States will meet next week in the Swedish capital Stockholm to try and hammer out a deal before an August 12 deadline agreed in May.

As the clock ticks down, China said it would seek to “strengthen cooperation” with Washington at the talks, and confirmed vice premier He Lifeng would attend.

Japan deal

“We just completed a massive Deal with Japan, perhaps the largest Deal ever made,” Trump wrote on his Truth Social platform on Tuesday. He said that under the deal, “Japan will invest, at my direction, $550 Billion Dollars into the United States, which will receive 90pc of the Profits”.

US Treasury Secretary Scott Bessent told Bloomberg Television on Wednesday that Japan received a 15 percent tariff rate, down from the 25pc threatened, as “they were willing to provide this innovative financing mechanism.” “They are going to provide equity credit guarantees and funding for major projects in the US,” Bessent added.

Japanese exports to the United States were already subject to a 10pc tariff, and this would have spiked to 25pc come Aug 1 without a deal. Duties of 25pc on Japanese autos — an industry accounting for eight percent of Japanese jobs — were also already in place, plus 50pc on steel and aluminum.

Japanese Prime Minister Shigeru Ishiba said that the autos levy had now been cut to 15pc, sending Japanese car stocks soaring, with Toyota and Mitsubishi up around 14pc each. The Nikkei rose 3.5pc. “We are the first (country) in the world to reduce tariffs on automobiles and auto parts, with no limits on volume,” he told reporters.

Rice imports

Japan’s trade envoy Ryosei Akazawa, who secured the deal on his eighth visit to Washington, said the 50pc tariffs on steel and aluminum would remain. Akazawa also said increased defense spending by Japan — something Trump has pressed for — was not part of the agreement. Trump said Tuesday Japan has also agreed to “open their Country to Trade including Cars and Trucks, Rice and certain other Agricultural Products, and other things.” Rice imports are a sensitive issue in Japan, and Ishiba’s government — which lost its upper house majority in elections on Sunday — had previously ruled out any concessions.

Published in Dawn, July 24th, 2025