【Reuters Breakingviews】Japan passes first Trump test with perfect timing

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

By Hudson Lockett

HONG KONG, Feb 10 (Reuters Breakingviews) - After months of speculation on whether Shigeru Ishiba would be able to rekindle the bonhomie his predecessor Shinzo Abe had with Donald Trump, the Japanese prime minister has proven he knows how to deliver exactly what the U.S. President wants - and not a moment too soon.

Indeed, the post-summit memo reads like a laundry list of Trump’s top concerns asked and answered. Chief among these was closing Japan’s $69 billion trade deficit, which the U.S. president described as “pretty easy to do.” Ishiba, for his part, promised to boost Japanese investment in the world's biggest economy to $1 trillion and buy more of its liquified natural gas.

These pledges ride on existing trends: Japan’s imports of American LNG rose 15% last year, per finance ministry figures. And its foreign direct investment position stateside already stood at about $780 billion in 2023 — the largest of any country. Though Ishiba's promise that Nippon Steel 5401.T will invest in U.S. Steel, instead of trying to buy the iconic company outright through an acquisition Trump has opposed, was met by silence from the Tokyo-based company.

In return for all of this - plus a gift to Trump of a golden samurai helmet - the prime minister received endorsement of Japan’s security concerns on issues ranging from China to North Korea and Russia.

Ishiba's relatively strong hand means he can afford some of the optimism he expressed following his White House summit about averting U.S. levies. But any such reprieve would mark a stark exception to the new tariffs Trump has vowed are coming for many trading partners this week. Other issues for Japan, including being caught in the middle of the U.S.-China tech war, may cause more friction later.

The friendly meeting also gives Ishiba has a stronger hand heading into negotiations with Japanese lawmakers over his 115.5 trillion yen ($759 billion) budget. The fact Trump didn't publicly push for more military spending suggests Tokyo's current, already record-high defense spending plan, equivalent to 1.4% of its GDP forecast for 2025, is adequate for now.

His new status as successful Trump wrangler strengthens the prime minister’s weak position within his Liberal Democratic Party which recently lost its parliamentary majority. He may not be Abe, but Ishiba appears capable of keeping his mercurial U.S. counterpart placated, so far as that is possible.

CONTEXT NEWS

Japanese Prime Minister Shigeru Ishiba expressed optimism about avoiding higher U.S. tariffs in an interview with broadcaster NHK on February 9, saying that President Donald Trump had “recognised” Japan’s role creating jobs and investing in America. Ishiba and Trump held their first White House summit on February 7.

Graphic: Japanese acquirors topped the US M&A ranks in 2024 https://reut.rs/4jMS5TL