The International Trade Council welcomes the truce between the United States and Japan, which allows most steel shipments from Japan to enter tariff-free for the first time since 2018. The agreement will remove the 25% levy on incoming steel imports from Japan, up to 1.25 million metric tons a year, and will take effect from April 1.
The agreement mirrors the accord that the U.S. reached with the European Union in October, ending punitive measures on up to $10 billion of each other’s goods. “Today’s announcement builds on the deal we struck with the EU and will further help us rebuild relationships with our allies around the world as we work to fight against China’s unfair trade practices,” says Commerce Secretary Gina Raimondo.
While the U.S. and EU seek to leverage their deal into a broader global arrangement to address non-market excess capacity and penalize countries that don’t meet low-carbon targets for steel and aluminum, Japan isn’t joining that process at this time. Japan wanted to focus the negotiations on steel, and thus the nation’s aluminum exports aren’t covered by Monday’s deal and will still face 10% tariffs.
This agreement will benefit both countries’ steel industries and strengthen the overall trade relationship between Japan and the U.S. The International Trade Council believes that this is a positive step towards resolving the metal disputes that started in 2018 when the U.S. imposed duties on steel and aluminum from its trading partners, citing risks to national security.