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BY Kofi Oppong Kyekyeku, 9:13pm July 22, 2025,

Trump unveils Japan trade deal, slashes tariff to 15% and claims $550B investment boost

by Kofi Oppong Kyekyeku, 9:13pm July 22, 2025,
Donald Trump
President Donald Trump -- Photo Credit: Gage Skidmore

President Donald Trump on Tuesday unveiled a new trade framework with Japan that includes a 15% tariff on Japanese imports, a notable reduction from the 25% rate he had previously threatened to impose starting August 1.

Trump made the announcement on his social media platform, Truth Social, declaring, “This Deal will create Hundreds of Thousands of Jobs — There has never been anything like it.” He added that the U.S. would “continue to always have a great relationship with the Country of Japan.”

As part of the agreement, Trump stated that Japan would inject $550 billion into the American economy “at my direction” and open its markets to U.S.-made cars and rice. While many specifics of the deal remain murky, including whether Japanese autos will still face the higher 25% tariff, the move is emblematic of Trump’s drive to present tariffs as leverage that benefits American workers and industry.

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The deal reflects a familiar strategy: aggressive tariffs followed by the declaration of favorable terms. Trump and his administration argue that such tactics will shrink the budget deficit and prompt manufacturers to relocate to the U.S., rebalancing long-standing trade deficits.

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However, critics warn that these tariffs could backfire. General Motors reported a sharp 35% drop in quarterly net income on Tuesday, attributing the fall to the impact of tariffs and cautioning of more financial pain ahead, sending its stock price down significantly.

Apart from Japan, Trump announced parallel tariff plans with other countries. The Philippines faces a 19% import tariff on its goods under a new framework, while American exports to the country would remain untaxed. He also reaffirmed a 19% tariff on Indonesian imports. The U.S. ran a $69.4 billion goods trade deficit with Japan last year, compared to $17.9 billion with Indonesia and $4.9 billion with the Philippines, according to Census Bureau data.

These tariff declarations come as an August 1 deadline nears, a date Trump has repeatedly cited in letters to global leaders. On Tuesday evening, he revealed that officials from the European Union would arrive in Washington the following day for high-stakes trade negotiations.

“We have Europe coming in tomorrow, the next day,” Trump told guests during a dinner event, AP reported.

Earlier this month, he threatened the EU’s 27 member states with a 30% tariff on all goods, effective August 1, if new trade terms were not reached.

Meanwhile, negotiations with China continue separately. Chinese goods remain subject to a 30% baseline tariff, and talks are expected to last through August 12.

READ ALSO: Trump tax law to add $3.4 trillion to deficit, leave over 10M uninsured by 2034 – Budget Office reveals

Treasury Secretary Scott Bessent is scheduled to meet with Chinese officials next week in Stockholm. Speaking on Fox Business Network’s Mornings with Maria, Bessent stressed the administration’s goal to rebalance both economies: “President Trump is remaking the U.S. into a manufacturing economy,” he said. “If we could do that together, we do more manufacturing, they do more consumption. That would be a home run for the global economy.”

Last Edited by:Kofi Oppong Kyekyeku Updated: July 22, 2025

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