The new U.S.-Japan trade deal lowers tariffs and strengthens economic ties, helping challenge China's regional aggression and instability.

After months of fraught negotiations with the United States, Japan clinched a deal just days before punitive tariffs were scheduled to take effect.

View PDF After more than three months of formal negotiations and many more months of speculation about the Trump administration’s trade and economic policy toward Japan, Washington and Tokyo have agreed to a trade deal.

The U.S. is significantly reliant on the Taiwanese company for advanced chip manufacturing, raising concerns due to its proximity to China.

The deal imposes 15% tariffs on Japanese cars and other goods, one of the more favorable rates. While the start date and other basic elements are still unknown, Treasury Secretary Scott Bessent warned this week that the US would monitor implementation and bump the rate up to 25% if Trump isn’t satisfied.

Analysts at Bank of America said that the Japan deal "looks like a reasonable blueprint" for other auto-exporting countries like South Korea.

Japan's government said on Friday that profits from a $550 billion investment package agreed in this week's tariff deal with the U.S. would be split between Japan and the U.S. according to the degree of contributions by each side.

The White House factsheet on the trade deal mentions that Japan will also buy 100 Boeing Co. planes as well as US defense equipment worth additional billions of dollars annually. Akazawa said both these pledges were based on existing plans by Japanese airlines and the government, respectively.

The United States and the European Union announced a trade framework Sunday after a meeting between President Donald Trump and European Commission chief Ursula von der Leyen.