President Trump will meet Prime Minister Shinzo Abe of Japan on February 10, thus becoming the second head of state to meet with the president at the White House since the inauguration. Abe will come with Finance Minister Taro Aso and Foreign Minister Fumio Kishida.
The Japanese leader is believed to be bringing with him a proposal to invest $450 billion in infrastructure projects for the US. The proposal includes plans for high-speed railway systems in Texas and California, and possibly create 700,000 jobs in the US. After meetings in Washington, Abe and his wife, Akie Abe, will fly to Trump's Mar-a-Lago resort in Florida for a round of golf. An avid golfer himself, Abe gave Trump a driver club when they met in New York in advance of the inauguration. Trump recently said that playing golf allows him to get to know people better than by having lunch with them.
Signaling the importance the Trump administration attaches to Japan, Secretary of Defense James Mattis visited South Korea and Japan on his first official foreign trip. He reaffirmed America’s commitment to the mutual defense treaty with Japan, especially in the wake of North Korea’s aggression. Defense cooperation will be a component of discussion for Trump and Abe. In addition to defense cooperation, they will undoubtedly discuss a possible bilateral trade agreement. Mattis gave assurances to Japan that the US will defend Japan's claims to the Senkaku Islands, which are disputed with China.
Much to Japan’s dismay, Trump pulled the US out of Trans-Pacific Partnership (TPP). While Abe has said he wants to challenge that decision, he has also shown interest in US-Japan free trade agreement or an economic partnership agreement. The upshot of their January 28 telephone call, according to the White House, was that they are "committed to deepen the bilateral trade and investment relationship.” Pulling out of TPP had some countries concerned because they believed that without the US presence, China would push its own trade pacts in the region that do not include the US.
Trump has complained that Japan does "things to us that make it impossible to sell cars in Japan, and yet, they sell cars [in the U.S.] and they come in like by the hundreds of thousands on the biggest ships I’ve ever seen." Japan exported 1.6 million vehicles to the U.S. in 2015, according to a Bloomberg analysis. American manufacturers sold less than 19,000 vehicles to Japan, thus adding to Japan’s status as the fourth-largest trade surplus with the US. Currently, Japanese consumers appear to be reluctant to buy American cars. Trade Minister Hiroshinge Seko of Japan said recently that his country applies no tariffs to US cars and wants to "explain this to the U.S.
Appearing to set aside some of Trump's campaign rhetoric about Japan, White House Press Secretary Sean Spicer said of the the two golf buddies, “This is a testament to the importance the United States places on the bilateral relationship and the strength of our alliance and the deep economic ties between the United States and Japan.” Vice President Mike Pence and Japanese Deputy Prime Minister Taro Aso will facilitate discussions on trade and Japan's proposed infrastructure projects.
Among the issues Trump and Abe may discuss are Trump's repeated criticisms of alleged Japanese currency manipulation. Trump has also accused Japan and China of manipulating their currencies, saying they “play the devaluation market and we sit there like a bunch of dummies.” Commonly, the yen can be devalued through foreign-exchange intervention, but Abe claims that his administration has not engaged in the practice since he came to power. However, a recent report on the American trade deficit in goods with Japan could give the lie to Abe's claim. US government data shows that the deficit ballooned to its second-largest level in 2016, totaling $68.94 billion, thus overtaking Germany.
While Chief Cabinet Secretary Yoshihide Suga has emphasized that Japan accounted for 9 percent of the overall U.S. trade deficit in 2016, down from 37 percent in 1997, he added that Japanese companies have made investments in the US. These include $411 billion in direct investments that have created 840,000 jobs, based on US data.
“The economic relationship between Japan and the U.S. has matured. We will try to gain more understanding of the Trump administration to deepen our relations,” Suga said at a news conference on February 8.
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