Biden's Veto of US Steel Bid Casts Pall Over Blinken's Tokyo Visit

Secretary of State in Damage Control Mode as Japan Questions Move to Halt Purchase

- Walter Sim

Visiting US Secretary of State Antony Blinken was in damage control mode on Jan 7 as he reaffirmed the importance of economic ties with Japan during talks with Japanese leaders.

Mr. Blinken also stressed the significance of investments by Japanese companies in the US.

This would normally be considered common sense - Japan has been the largest source of US foreign direct investment since 2019. Yet, the need to reassert the point - at a working lunch with Japanese Foreign Minister Takeshi Iwaya, according to a readout - signals the damage wrought by US President Joe Biden's decision to halt a US$14.9 billion (S$20.3 billion) bid by Japan's Nippon Steel to acquire US Steel on "national security" grounds.

That cast a pall on Mr. Blinken's farewell tour to Tokyo, coming ahead of the Jan 20 inauguration of Donald Trump as US president.

Mr. Blinken did not take questions from the waiting media pack at the Prime Minister's Office in Tokyo after a closed-door meeting with Prime Minister Shigeru Ishiba.

Instead, he chose to focus on the positives in brief remarks, expounding on the relationship as "an alliance, a partnership, a friendship that's grown stronger than it's ever been before," with their economies "extraordinarily intertwined."

But Mr. Iwaya told reporters at an evening news conference: "At this juncture, I felt I had no choice but to raise the issue of the US Steel acquisition."