Trump piles up trade deals as Asia agrees to open up to American goods

It's not easy to catch Washington's formidable trade lobbies and relentless, scoop-hungry journalists off-guard. Yet on July 22, US President Donald Trump did just that.

- Bhagyashree Garekar

On a day when analysts were poised to dissect a potential deal with the Philippines, awaited after President Ferdinand Marcos Jr.'s visit to the White House, Mr. Trump blindsided everyone with a "massive" deal with Japan.

"We just completed a massive deal with Japan, perhaps the largest deal ever made," he said on his social media platform Truth Social.

"Japan will invest, at my direction, $550 billion 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," he added. The amount is around S$703 billion.

Confirmed by Japan's chief negotiator Ryosei Akazawa, the deal slashes US tariffs on imports from Asia's second-largest economy to 15 per cent, well below the 25 per cent threat that loomed after the July 9 tariff pause ended.

Japan will also accede to a key White House demand and open its market to American cars, trucks, rice and certain other agricultural products.

In a win for Japan's powerful carmakers, their exports to the US will attract lower tariffs of 15 per cent.

The announcement stole the thunder from the Philippine deal, which had been previewed only hours earlier on Truth Social.

Mr. Trump said Philippine exports to the US will be subject to a 19 per cent tariff — higher than the 17 per cent initially proposed in April but lower than the 20 per cent threatened earlier in July. In contrast, the Philippines will levy zero tariffs on US goods.

THREATEN STEEP TARIFFS TO MAKE OTHERS BUY MORE AND INVEST MORE

On the same day, further details emerged on the July 16 agreement with Indonesia, South-east Asia's largest economy.

Key provisions included the elimination of nearly all Indonesian tariffs on US goods and a 19 per cent US tariff on Indonesian exports, with certain goods containing content from "non-market economies" (read: China) to be tariffed at 40 per cent.