Japan is facing a difficult decision as it navigates the terms of a trade deal with US President Donald Trump. The $550 billion investment pledge made by Japan is expected to be scrutinized, with concerns that American officials may select projects that don’t benefit Japan.
A new prime minister, Sanae Takaichi, will meet with Mr Trump on Tuesday to discuss how Japan can invest hundreds of billions of dollars in the US while increasing military spending. The meeting comes three months after the agreement was signed, and both sides are still trying to figure out what investments will be made.
The previous administration’s deferential negotiating strategy secured a contentious trade deal, but critics say it came at a high cost to Japan. One key point of contention is the provision that allows Mr Trump to dictate how the $550 billion fund is spent. This has raised concerns about strategic sense and potential losses for Japanese companies.
Mr Akazawa, who led the negotiations, had attempted to disarm Mr Trump by appearing unassuming. He even wore a “Make America Great Again” cap during one meeting, but this approach did not yield results. The trade deal was structured like a real estate deal, with Japan investing around $300 billion in the American economy.
However, some experts argue that Mr Takaichi should take a harder stance on the deal and stand her ground on the investment pledge. They say that Mr Trump’s pattern is to focus on headlines rather than the details of trade deals.
Japan’s new prime minister has moderated her language since taking office, saying she will not try to reopen the pact with Mr Trump. But it remains to be seen whether she will stick to the same negotiating tactics as her predecessor.
Source: https://www.nytimes.com/2025/10/26/business/japan-investment-trump-tariffs.html