Donald Trump’s five-day trip into Asian diplomacy turned ceremonial and high stakes this past week after he received wonderful royal treatment in Japan. Trump was the first foreign head of state to be offered an audience with newly enthroned Japanese Emperor Naruhito, symbolizing the enduring ties of U.S.-Japanese alliance. This ceremonial start in Tokyo was planned as a sort of overture to the more substantive discussions on trade and defense with Japan’s new Prime Minister Sanae Takaichi.
The pomp of the imperial reception for Trump emphasized, perhaps above all, the significance of the alliance after a period of American demands for greater trade reciprocity and increasing pressure on Tokyo.
With the trip now moving toward South Korea for a critical meeting with Chinese President Xi Jinping, global investors are transfixed on the anticipated trade truce between China and the U.S. that may relieve the pressure on the current trade war.
Japanese Alliance & Investment
The visit was framed by weighty and immediate bilateral economic commitments. Aiming to evade the heavy tariffs leveled against other trading partners by Trump, Japan has already agreed to commit a whopping $550 billion into the United States for temporary reprieve on American import tariffs.
New Prime Minister Takaichi, a conservative ally of former Prime Minister Shinzo Abe, is looking to strengthen this goodwill by promising to purchase U.S. agricultural products such as soybeans, American pickup trucks, and gas.
There are also expectations of signing a new memorandum of understanding regarding investment in shipbuilding, an area where the U.S. is trying to rebuild its capacity against the backdrop of growing competition from Beijing.
On the security side, Takaichi is trying to reassure Washington of Japan’s commitment to burden-sharing by pledging to accelerate Japan’s largest military buildup since World War II to appease U.S. concerns about an aggressive China.
US-China Trade War De-escalation
A glaring shift in diplomatic direction would take place toward the meeting with President Xi in South Korea. Hopes for a truce in the trade war seem to have revived after the two largest economies in the world have tentatively agreed to a framework agreement.
The agreement would serve as a temporary stopgap against imposing higher U.S. tariffs (set at 100% on designated Chinese goods) and easing China’s grip on rare earth mineral exports. News of such de-escalation led to euphoric rises in Asian stock market, reflecting a rare joint global sigh of relief for investors and businesses that have endured months of unpredictable unilateral tariff escalations.
While no one is expecting a full resolution on the complex structural issues, such as those concerning intellectual property and forced technology transfer, the point of the summit is to manage disagreements and make small improvements, thereby paving the way for more serious negotiations in early 2023.
Also Read: US-China Trade Deal: Major Shift Ahead Of Donald Trump-Xi Jinping Meeting | DETAILS
A recent media graduate, Bhumi Vashisht is currently making a significant contribution as a committed content writer. She brings new ideas to the media sector and is an expert at creating strategic content and captivating tales, having working in the field from past four months.
