Japan Likely to Remain under U.S. Pressure to Cut Trade Surplus

Tokyo, Oct. 18 (Jiji Press)--Japan is expected to remain under U.S. pressure to cut its trade surplus in new talks as the bilateral trade imbalance remains large, economists said. Japan's customs-cleared trade surplus with the United States narrowed 8.5 pct in the fiscal first half ended last month from a year before to 3,093.2 billion yen, though exceeding 3 trillion yen for the eighth straight half-year period, according to the Finance Ministry. Imports from the United States to Japan grew 9.4 pct to 4,422.1 billion yen, driven by strong demand for liquefied petroleum gas and liquefied natural gas. Japan's exports to the United States inched up 1.3 pct to 7,515.3 billion yen, led by construction and mining machinery. In their summit meeting last month, Japanese Prime Minister Shinzo Abe and U.S. President Donald Trump agreed to launch new talks to scrap and reduce tariffs. The talks on a trade agreement on goods, or TAG, are expected to begin as early as January next year. The United States is demanding Japan open its market to U.S. agricultural products more widely. Japan for its part has no plans to make deeper concessions than it did under the 11-country Trans-Pacific Partnership free trade pact. On Wednesday, the U.S. Treasury Department reiterated its concerns about the trade imbalance and the yen's weakness. Japan's "trade surplus with the United States is unlikely to shrink dramatically because demand in the United States remains strong," said Yota Hirono, a researcher at the Daiwa Institute of Research. "I think Japan will remain under persistent U.S. pressure to cut its trade surplus in the TAG talks," Hirono said. END