- The visit aimed to finalise a $550bn investment package to ease US tariffs on Japanese imports
- US agreed to cut tariffs on Japanese goods from 25% to 15% in exchange for Japan's investment pledge
- Disagreements remain over profit sharing and tariff order amendments between Japan and the US
Japan's trade negotiator Ryosei Akazawa cancelled a visit to the US at the last minute on Thursday. The move threatens to delay finalisation of a $550 billion investment package offered by Japan to the US in order to ease punitive US tariffs.
Akazawa was scheduled to visit the US on Thursday, to formalise confirmation of the $550 billion package and its financial details, such as the split of returns between the two countries, per Reuters.
US Commerce Secretary Howard Lutnick had also communicated about an announcement this week about Japan's $550 billion investment.
According to Yoshimasa Hayashi, a spokesperson for the Japanese government, "It was found that there are points that need to be discussed at the administrative level during coordination with the American side. Therefore, the trip has been cancelled."
The US and Japan had arrived at an agreement about cutting tariffs on Tokyo's imports to 15 per cent - lower than the previous 25 per cent - in exchange for the investment pledge.
However, US President Donald Trump had claimed that the package was "our money to invest, as we like" and said that the US would retain 90 per cent of the profits. Japanese officials differed and stressed that the investment would be subject to mutual benefits.
Hayashi also requested an amendment to the presidential order stating, "We are strongly requesting that measures be taken to amend the presidential order concerning mutual tariffs as soon as possible, and to issue a presidential order to reduce tariffs on auto parts."
Japanese officials have repeatedly said they would rather have an amended presidential executive order first to remove overlapping tariffs on Japanese goods before releasing a joint document on the investment details.
Kyodo News, a Japanese media outlet, has said that it has not been decided whether the trade negotiator will reschedule the trip, whereas Reuters has reported that Akazawa could be in Washington next week.
This comes ahead of PM Modi's two-day visit to Japan on August 29-30 at the invitation of Japanese Prime Minister Shigeru Ishiba. This visit marks the 15th India-Japan Annual Summit, where the two leaders will discuss various aspects of their strategic partnership - the Quad being one of them.
