A draft agreement could be signed by the end of September, the Nikkei reported. Trump, who threatened to raise tariffs on the approximately $50 billion worth of cars and auto parts Japan exports to the US annually, had hinted that there might be a deal in August.
The latest actions are a sign of Trump’s growing frustration with the lack of progress in his trade assault on China and a slowing economy, according to analysts and people close to the administration.
“Trump will likely have to end the trade war if he wants to avoid a US recession and get re-elected next year,” said Shane Oliver, head of investment strategy and chief economist at AMP Capital. “At this stage there is still no end in sight and so share markets likely have to fall further to pressure Trump to solve the issue and de-escalate.”
Agricultural goods, automobiles and car parts were the focus of talks between the trading partners. The agreed framework calls for Japan’s tariffs on imported beef to be lowered gradually to 9% from 38.5%, the Nikkei said. Japanese automakers have expressed concern over Trump’s actions in the market.
Akio Toyoda, president of Toyota Motor Corp. and chairman of the Japan Automobile Manufacturers Association said in May he was “dismayed to hear a message suggesting that our long-time contributions of investment and employment in the US are not welcomed.”