U.s.-Japan Trade Agreement And U.s.-Japan Digital Trade Agreement


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Finally, the USJTA could have a broader impact on the trading system – some argue that it is not WTO-compatible. Such an argument is that it does not meet the requirement set out in Article XXIV(8)(b) of the General Agreement on Tariffs and Trade (GATT) to eliminate tariffs under a free trade agreement on `essentially all trade`. Given that the scope of tariff reductions under the USJTA is limited, such a critical approach seems to be the right one. Companies dealing with Japan and U.S. trade are encouraged to review the text of the agreements and understand the potential benefits. To this end, companies can consider emergency measures: another important aspect of the USJTA is its incremental approach. The agreement is signed on the basis of the areas in which negotiations have been concluded, with the agreement that discussions in other areas are not yet completed. The reaction to this cumulative approach was mixed. Both agreements aim to promote free trade between the two economies, which together accounted for about 30% of the world`s gross domestic product. (12) General Note 4(a)(k) to Annex II to the Trade Agreement.

ustr.gov/sites/default/files/files/agreements/japan/Annex_II_Tariffs_and_Tariff-Related_Provisions_of_the_United_States.pdf. In any event, it seems premature to draw a definitive conclusion on the impact of the USJTA during this initial phase, given that negotiations must clearly continue. It would be more productive to focus now on how this agreement can be successful, both in substance and in its wider impact on international trade. Meanwhile, U.S. tariffs on Japanese air conditioning parts and fuel cells were removed as soon as the trade pact came into effect. Within four months of implementation, President Trump and Prime Minister Abe will shift their efforts to a broader trade deal. This broader agreement should cover both tariff and non-tariff barriers, including tariffs and restrictions on trade in services and investment. The jackpot for Japan is outside the deal – it escaped an increase in tariffs on Japanese cars that the Trump administration had threatened under Section 232 of the Trade Expansion Act of 1962. . .

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