Ahead of PM Modi's visit, Japan Cancels Its Trade Negotiator's US Trip

In a suprising development, Japan's trade negotiator, Ryosei Akazawa, on Thursday cancelled a scheduled visit to the United States. The move is likely to postpone the finalization of a $550 billion investment proposal that Japan had made to the US as a solution for mitigating punitive American tariffs.

Akazawa was due to go to the US to seal the $550 billion package and outline its financial conditions, including the distribution of the returns between the two countries, Reuters reported.

US Commerce Secretary Howard Lutnick had said earlier that Japan's $550 billion investment announcement was to come this week.

Yoshimasa Hayashi, a government spokesperson, clarified, "It was determined that there are issues that should be talked about on the administrative level through coordination with the American side. Thus, the trip has been cancelled."

The US and Japan had also agreed to reduce tariffs for Japanese imports to 15 percent, from 25 percent, in exchange for Japan's commitment to invest.

Nonetheless, US President Donald Trump claimed that the package was "our money to invest, as we like," and that the US would get to keep 90 per cent of the gains. Japanese officials opposed this, reiterating that the investment would be on the basis of mutual advantage.

Hayashi also called for a revision to the presidential order, saying, "We are strongly requesting that steps be taken to revise the presidential order on mutual tariffs as soon as possible, and issue a presidential order lowering tariffs on car parts."

Japanese officials have repeatedly emphasized that they would like a revised presidential executive order removing double tariffs on Japanese products prior to issuing a joint statement on the investment specifics.

Kyodo News, a news organization in Japan, quoted that it is not clear whether Akazawa will reschedule his US visit, while Reuters quoted he could visit Washington next week.

This news comes before the two-day visit of Indian Prime Minister Narendra Modi to Japan on August 29-30, at the invitation of Japanese Prime Minister Shigeru Ishiba. The visit is scheduled to be the 15th India-Japan Annual Summit, during which the two leaders will discuss all aspects of their strategic relationship, including the Quad.