Trump Tariffs to Push Japanese Economy Downward; Estimated to Reduce GDP by 0.59 Percent in 1 Year

By Hiroyuki Tanaka / Yomiuri Shimbun Correspondent

16:11 JST, April 3, 2025

WASHINGTON — U.S. President Donald Trump has decided to impose a baseline 10% tariff on goods around the world. He will impose even higher tariffs on countries and regions with which the U.S. believes it has a trade deficit or which have nontariff barriers. This will inevitably put downward pressure on the Japanese economy.

The U.S. is the largest destination for Japan’s exports, and a 25% tariff on automobiles is scheduled to take effect on Thursday. Takahide Kiuchi of Nomura Research Institute, Ltd. estimates that the reciprocal tariffs of 24% would reduce Japan’s GDP by 0.59% in one year.

Trump considers the U.S. trade deficit to be a drain on the country’s wealth. He aims to reduce U.S. imports from its trading partners through reciprocal tariffs and to increase exports of U.S. products by pressing for tariff reductions and the relaxation of nontariff barriers through individual negotiations. The Japanese government needs to strongly urge the U.S. to review the measure while keeping a close eye on U.S. requests.