Japan's Abe Hits Back at Trump's Plan to Slap Tariffs on Ally

(Bloomberg) -- Japanese Prime Minister Shinzo Abe hit back at U.S. President Donald Trump’s push to impose higher tariffs on imported vehicles and metals.

"We can’t accept this," Abe said in parliament on Wednesday in response to a question on the already-in-place metal tariffs and the possible introduction of new levies on cars. "From a security perspective, it’s very difficult to understand why this would be imposed on Japan, a military ally."

Trump’s order last week to investigate auto imports for potential trade penalties on national security grounds came as a surprise and quickly drew opposition from the industry, Republican lawmakers and foreign nations. The tariffs, which could be as high as 25 percent, would hurt Japan’s automakers such as Toyota Motor Corp., and damage an economy that shrunk in the first quarter for the first time in two years.

Trump Raises Pressure on China With Swerve on Tariff Plans

Abe’s pointed comments add to opposition from other U.S. allies such as the European Union, whose trade chief will speak to Commerce Secretary Wilbur Ross on Wednesday in an attempt to secure a permanent exemption from the metals tariffs. The U.S.-China trade dispute has also come back to the boil, with Trump moving ahead with plans to impose tariffs on $50 billion of Chinese imports. Ross is scheduled to travel to China this weekend to discuss trade.

"We’d consider going to the World Trade Organization" if the U.S. took steps to reduce imports, Abe said. In fact, Japan has already told the WTO that it may impose at least $264 million worth of tariffs on U.S. goods in retaliation for Trump’s tariffs on steel and aluminum imports, according to a notification to the WTO last week. Those levies have affected companies including JFE Holdings Inc. and Kobe Steel Ltd.

"Japan should take a leading role in preserving the WTO framework. And so we will act when we feel we should act," Abe said.

©2018 Bloomberg L.P.

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