Analysis: What’s at stake as Trump mulls dealsーNHK WORLD-JAPAN NEWS
Well, Japan’s prime minister is looking to reach a trade agreement with the US president on the sidelines of next month’s G7 summit in Canada. Tokyo also hopes for another round of tariff talks later this week. Ishibashugu met with economic revitalization minister Akazawa on Sunday. He’s the chief negotiator in the talks. Akazawa just returned to Japan after meeting US trade representative Jameson Greer and other senior officials in Washington. Their prime minister was briefed on what was discussed in the latest round of the bilateral negotiations. Japan is proposing a plan that aims to promote Japan US cooperation in the ship building sector. Ishiba says that Tokyo is considering repairing US military vessels in Japan and promoting cooperation regarding icebreaking ships that travel in the Arctic Circle. US Treasury Secretary Scott Besson was absent from the third round of negotiations. Akazawa says he wants to hold talks with him when he is available. Many are closely watching another major deal in the works and President Donald Trump has offered an update. He says that Napon Steel can have quote partial ownership of US steel but he also vowed that the firm would remain under American control. Trump made the comments to reporters in New Jersey on Sunday. much. I think it’ll be controlled by the United States. Otherwise, I wouldn’t make the deal. We’ll see. But it would it’s an investment and it’s a partial ownership, but it’ll be controlled by the USA. Trump didn’t give details, including how big Nippon Steel’s state could be. Trump’s remarks indicate that he is still weighing the deal. He is to make the final decision on the case by June 5th. US media say his comments are leaving many questions unanswered. Business news outlet Bloomberg says, quote, “Inves investors, executives, and diplomats are still unsure of what exactly the US president endorsed.” Well, we’ll get some analysis on all this in a moment, but first, a quick refresher. Ion Steel’s plan to take over US Steel was announced in December 2023. It soon became a major political issue. Thank you very much. Donald Trump called the deal a horrible thing when he was a contender for president in January 2024. He promised to block it immediately if he won office. Trump was sworn in as president on January 20th. He held summit talks with Japan’s prime minister Ishibashigeru in early February. The US Steel is a very important company to us. We didn’t want to see that leave. Uh, and it wouldn’t actually leave, but the concept psychologically not good. Trump said Nepon Steel agreed to invest heavily in US steel as opposed to owning it. Trump reaffirmed his hardline just days later, saying, “Nobody can have a majority stake in US steel.” On April 7th, the president instructed the committee on foreign investment to conduct a fresh review of the proposed deal to identify any national security risks. Ordering another review is unusual. Some saw it as a sign the acquisition might be approved. I would read some of these. But once again, Trump poured cold water on the idea of turning US steel into a wholly owned subsidiary of the Japanese company. And we love Japan, but for a foreign country to buy that cherished US Steel brand, that’s hard for me to do. Well, it can also be hard to follow all of the twists and turns in this saga. Luckily, our senior commentator Sakurai do is here to explore the deal’s prospects as well as tariff negotiations. Do great to have you. So, first of all, uh let’s start with US Nippon deal, US deal and of course Trump. Now, it looks like um will he or won’t he? Part of the story is already over. So, what’s motivating him now to say that the partnership will move forward? Well, I think what may be on his mind is that time is running out for all the key players involved. This has been ongoing for 14 months. US Steel desperately needs fresh money and cutting edge tech from Nepon Steel to compete globally. I remember it was US Steel that wanted the deal and it needs to make new investments. Now, we’ve seen many other steel mills closing in the past several months due to tougher competition. Trump faces a delicate balance. He’s looking to keep his election campaign promise and still save the US firm. But if its tariff talks are any indication, this might be hard to pull off. Experts say that the US had to make huge compromises to strike deals with the UK and China. Trump wants some kind of news that can appeal to workers in the manufacturing sector. So what’s in it for nippon steel? Well, that’s a big question. It’s still unclear how much ownership Trump will allow the Japanese firm to gain, but the original idea of making the US firm its wholly owned subsidiary may not happen. Now, there are some key things Nepon Steel hopes to gain. It can work with US steel in the field of decarbonization using technologies called electric arc furnaces. The American firm has the tech that uses steel scrap and electricity to produce steel and cut back on carbon emissions. The Japanese company can also avoid a massive penalty. If the deal completely breaks, it would have to um it will if the deal completely breaks, it will have to pay about $565 million. Yeah, that’s a big chunk of change. So now you mentioned tax. What’s Nippon Steel’s contribution in this field? Well, it has a lot to offer too and that carries a different set of challenges in order to provide its cuttingedge technology. The firm needs to be assured that its contribution will be safely secured and protected from leaks. That’s actually one reason why the company wanted a fullyowned subsidiary. Uh Trump is expected to visit the US Teal plant in Pittsburgh on Friday. We’ll see if more details are hammered out as we near the date. And I go uh switching to the other big deal we’ve been following. The Japanese government is trying to make progress with the trade uh deal with the US. How do you think this will play out? Well, I expect the White House will gradually take more of a realistic approach. Uh Treasury Secretary Scott Vessent seems to be gaining more power and winning more of Trump’s confidence in recent days. Uh he appears to be less of a hardliner compared to others in the administration. U Tokyo has been coming back with proposals such as cooperation in the ship building sector where Washington wants Japan’s help the most. We have yet to see if Trump’s team is shifting to a softer stance to avoid further economic repercussions. But I think what Japan is trying to emphasize to the US is true that investments actually work much better than tariffs. It’s up to the White House whether it follows the suggestion from one of its important allies. Thanks, Deo. Insights from NHK senior economic commentator Sakurai Deo.
US President Donald Trump’s comments on Nippon Steel’s bid to acquire US Steel are capturing attention. NHK Senior Economic Commentator Sakurai Reiko explores what’s at stake in that deal, as well as what could come next in the US-Japan tariff talks. #japan #analysis #trade #politics #usa #donaldtrump #tariffs #business
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