WASHINGTON -- Bilateral auto trade likely loomed large in Friday's meeting here between U.S. President Donald Trump and Japanese Prime Minister Shinzo Abe, at a time of American demands for more domestic production to create jobs and narrow the trade deficit with Japan.
Addressing the U.S. Chamber of Commerce that morning, Abe tried to parry Trump's criticism on trade. Far more Japanese vehicles are made by American workers than shipped from Japan, Abe noted.
The prime minister emphasized other threats, such as the glut of steel and other products that arose after such emerging economies as China joined the World Trade Organization, as well as cross-border cyberattacks and the use of antitrust law to block market entry. Abe said he hopes to demonstrate the unshakable U.S.-Japan alliance.
Washington fired preliminary salvos on the auto issue Thursday. A bipartisan group of six Midwestern lawmakers released a statement urging progress on opening up Japan's auto market, calling it the most closed among developed countries. A senior U.S. administration official said Trump's priorities at the summit would be "jobs, jobs, jobs," implying a focus on the auto industry and the many people it employs.
The U.S. has pushed not only for Japanese automakers to expand American production, but also for the Japanese government to rework environmental regulations to lower barriers to sales of American vehicles there.
A hard line by Washington would force Tokyo to take a more combative posture with such demands as immediate elimination of tariffs on Japanese autos. If the two sides cannot see eye to eye here, cooperation on other issues such as investment rules will become trickier.