U.S. and Japan Reach Trade Deal
Trump says Tokyo will face 15% reciprocal tariffs instead of the 25% he had threatened
Updated July 23, 2025 The Wall Street Journal
Japan will open its market to U.S. trade, including cars, trucks, rice and other agricultural products.
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- President Trump announced a trade agreement with Japan, setting so-called reciprocal tariffs at 15%.View more
The U.S. and Japan have reached a trade agreement, President Trump wrote in a social-media post Tuesday evening, saying he would set his so-called reciprocal tariffs at 15% for the country.
Under the deal, Japan will invest $550 billion in the U.S., Trump said in his post on Truth Social. The U.S. will receive 90% of the profits from the investments, he added, without providing further details. Japan will also open to trade, Trump said, listing goods including cars and trucks, rice and other agricultural products.
Critically for Japan and its powerhouse auto industry, Tokyo’s top trade negotiator said tariffs on autos will also be lowered to 15% from their current 25%.
Trump said at a meeting with Republican lawmakers at the White House that the Japan deal is the “largest trade deal in history—maybe the largest deal in history.” He added that the Japanese government would enter a “joint venture” for liquefied natural gas exportation in Alaska. The administration and gas industry have long sought to secure partners for a proposed export project in that state.
Japanese Prime Minister Shigeru Ishiba said he received a report on the deal from his chief negotiator.
“The government was determined to protect national interests,” Ishiba told reporters Wednesday morning in Tokyo.
The deal “will lead to Japan and the U.S. working together to create jobs, produce high-quality goods, and contribute to fulfilling various roles in the world going forward,” he added.
Tokyo’s chief negotiator, Ryosei Akazawa, wrote “mission accomplished” on his personal X account, sharing a photo of himself pointing to a picture on a White House stairway depicting Ishiba in discussion with Trump during the G-7 summit in Canada in June.
The 15% reciprocal tariff rate is lower than the 25% tariff that Trump threatened recently in a letter to the Japanese government. Akazawa told reporters in Tokyo that Japan also negotiated a reduction in separate national security tariffs on autos, to 15% from 25%. But he said there is no change to similar tariffs on steel, currently at 50%.
Automotive levies in particular had been a sticking point in negotiations between the governments for months.
Japan’s Nikkei Stock Average closed up 3.5%, and Toyota Motor shares rose 14% on the news, with investors viewing the blow to Japan’s economy as less severe than feared. Cars are among Japan’s biggest exports.
Write to Gavin Bade at gavin.bade@wsj.com and Megumi Fujikawa at megumi.fujikawa@wsj.com
President Trump announced a trade agreement with Japan, setting so-called reciprocal tariffs at 15%.
Japan will invest $550 billion in the U.S., with the U.S. receiving 90% of the profits, according to Trump.