Lost in the shuffle this past week was one piece of good news for Trump: a tentative trade deal with Japan that he and Japan’s PM Shinzō Abe signed in New York on the sidelines of the UN General Assembly meeting. While it is largely a favorable deal, it does not do too much and leaves the most difficult issue to be resolved by later negotiation, namely regarding the auto industry.
Trade restrictions are lowered on a variety of agricultural goods, including pork, beef, wheat, corn, and some fruits the US exports (but not soybeans), and on a few Japan exports including green tea, persimmons, and soy sauce.
In the industrial area, restrictions are lowered on machine tools from Japan and some scattered others. Restrictions are also lowered on digital products going both ways. I do not know how much this will increase trade flows overall each way.
This is good news especially for many farmers, a main concern of Trump’s although not soybean farmers, with, if anything, they possibly suffering from the lowering of barriers on soy sauce from Japan, which will hit Kikkoman in southern Wisconsin.
Of course autos are a very large item involving trade between the two countries, and there is no change on that one.
The final irony, of course, is that most of this, especially in the agricultural area, was part of the TPP that the US withdrew from. So basically this resembles the USMCA NAFTA replacement largely and simply putting in place the changes with other nations that would have happened anyway if the US had not withdrawn from the TPP. In short, it is undoing Trump’s own handiwork from early in his administration, although that point is not being emphasized.