New Reciprocal Tariffs Set: United States’ Inward-Looking Stance Causes Concern

Editorial

14:00 JST, August 3, 2025

The administration of U.S. President Donald Trump has decided on new tariff rates for its “reciprocal tariffs.” How should Tokyo deal with Washington’s increasingly inward-looking stance? Japan must strengthen its cooperation with other countries and regions.

Trump signed an executive order setting new reciprocal tariff rates last Thursday. The order imposes tariffs ranging from 10% to 41% on about 70 countries and regions with whom the United States has trade deficits, which it views as problematic.

Japan and the European Union will be subject to a 15% tariff, while Syria will face the highest rate of 41%. Other countries not included in the executive order will be subject to a 10% tariff. The tariffs will take effect on Thursday.

After World War II, the global economy developed with the United States playing a leading role to promote a free trade system. The United States had one of the most open markets in the world before the second Trump administration began, with an average tariff rate of just over 3%.

The world’s largest economy has now unilaterally built high tariff barriers. Although the tariff rates have been reduced from the levels initially announced in April, the measures are certain to have a negative impact on the global economy, and this is a cause for serious concern.

In negotiations between the United States and other countries and regions aiming at reducing tariff rates, the United States has been conspicuously overbearing. While imposing high tariffs of 20% on Vietnam and 19% on Indonesia, despite their relatively small economic sizes, the United States has insisted on the principle of eliminating tariffs on its own exports.

It must be said that trust in the United States, which openly embraces an “America First” policy, has been severely damaged.

The Trump administration’s agenda has not progressed entirely as planned. Negotiations with China, the largest source of the U.S. trade deficit, have been rough going. This may indicate the limitations of the high tariff policy.

If the costs of high tariffs are passed on to consumers and prices rise again in the United States, public dissatisfaction in the country will inevitably grow.

With China in mind, Japan plans to establish manufacturing bases of important products for its economic security in the Unites States in order to build a mutually beneficial relationship. It is necessary to repeatedly explain to the United States that promoting such cooperation between Japan and the United States is the path the two countries should pursue.

The new tariff measures will take effect on Thursday, but concern remains that Trump will continue to brandish high tariffs in the future. It is important for Japan and other countries to work together to prevent the collapse of the free trade system.

Reducing dependence on the United States while mutually expanding markets could be an effective countermeasure.

Automobile tariffs, which are Japan’s top matter of interest, are not included in the executive order. The lack of a timeline for reducing them to 15% is a cause for concern. The Japanese government should repeatedly urge the early implementation of the reduction.

(From The Yomiuri Shimbun, Aug. 3, 2025)