Analysis. Japan, between a rock and a lucky chance

After Donald Trump’s win of the U.S. presidency, Japanese Prime Minister, Shinzo Abe, made and informal visit to New York on November 18th to meet with then president-elect and to highlight Japan’s interest in the relation with the new U.S. administration.

Despite that this was presented as an initial rapprochement to endorse mutual trust between countries to the public eye it is true that several topics would have been discussed in private between the two leaders, such as Abe’s interest on rescuing the Trans-Pacific Partnership (TPP), concerns of the new U.S. administration over a trad relationship that it considers disadvantageous (in 2016 the trade deficit of the U.S. with Japan was of US$68,900m), as well as the status of the military allegiance that Trump rates as unfair, arguing that Japan should pay more for it.

For Japan, the trade and economic agenda with Washington, as well as the survival of their military allegiance are enough reason for urgent political decisions before a president that knows how to negotiate from a position of power. In the light of Trump’s (expected) decision to

pull the U.S. out from the Trans-Pacific Partnership (TPP), Japan’s anxiety has been on the rise since the measure was informed last January 23rd.

At a bilateral level, Japan has already felt the pressure to relocate activities from the car-assembly plants based in Mexico: Trump threatened Toyota with enforcing a border tax should it remain with plans for the construction of a new car-assembly plant in Mexico to build vehicles for the U.S. market. These threats resulted in significant losses for Toyota’s shares in New York and Tokyo. Toyota’s president, Akio Toyoda, reiterated that his firm creates jobs and channels investments to the U.S. before meeting last February 3rd with Prime Minister Abe to coordinate a joint government- private sector message for Trump before Abe’s official visit to Washington last February 10th.

However, concerns of the depletion between a Japanese-U.S allegiance in the Asian-Pacific region have decreased amidst the new U.S. administration perception of China and North Korea as a mounting threat.

Given the presence of the Chinese army in the artificial islands built in the South China Sea, and Pyongyang’s statement of an imminent launching of intercontinental missiles for the first time, Trump sent Defense Secretary, James Mattis, to South Korea last February 3rd to affirm the U.S. commitment with the allegiance and its concern for the safety of northeast Asia by reasserting that the Senkaku islands (called Diaoyu by China), under Japanese rule are protected by the 5th article of the Mutual safety treaty which means that the U.S. would help Japan in the event of an attack. While the new U.S. administration wishes that Japan assumes a larger financial charge in the preservation of U.S. military bases located in Japanese land.

President Trump could certainly represent a risk for the economic development of Japan, as well as for its safety in the region. It is possible that the new U.S. administration demands Tokyo to base more Japanese companies in the U.S., as well as a greater openness to U.S. exports and investments in the future. Additionally it may well impose high tariffs on Japanese goods (including those manufactured in Mexico), resulting in long term damage of the Japanese economy. Similarly, the U.S. may demand payment of its full military presence in Japan as Trump announced in 2015.

However, this U.S. president, a natural negotiator, can represent an opportunity for Japan, a nation which has always been well-versed in the art of business negotiations. Tokyo is already proposing a mutual benefit economic package to the U.S. that includes the construction of infrastructure, new energies and state of the art technology. Additionally, Tokyo would be willing to pay for over 70% of the current expenditure for military bases under the Japan-U.S. allegiance, should this guarantee the relocation of U.S. troops from Okinawa amidst the military display of its neighbor, China.

In terms of pure geopolitics, to concede to Washington’s economic demands can guarantee better relations with Russia for Tokyo. A nation with which Japan attempts to negotiate the return of Soviet- occupied territories north of Hokkaido, given the recent ally relation of U.S. with Russia.

Whilst, it is soon to make a proper diagnostic of Japan’s relation with the U.S. in the Trump era, it is safe to say that Japan is quickly adapting to new challenges.

Ulises Granados is a professor and coordinator of the Asia-Pacific Studies Program at ITAM

@ulisesgranados