Japan Mobilizes Support for Industries Amid Trump’s Tariff Threat

The administration of Prime Minister Shigeru Ishiba is gearing up to address the challenges posed by the tariff measures imposed by U.S. President Donald Trump, which threaten Japanese industries and employment. During recent discussions with local leaders, including Tokyo Governor Yuriko Koike and Aichi Governor Hideaki Omura, Ishiba acknowledged the potential repercussions of the tariffs and committed to taking appropriate steps to support Japan’s export sector.

The tariffs, which include a steep 24% levy on Japanese exports to the U.S.—temporary for now—alongside a consistent 10% rate and a 25% duty on automobiles, have raised concerns among industry officials. Koike emphasized that the U.S. tariffs could lead to significant adverse effects on businesses in her region, which houses a substantial number of companies, including major manufacturers like Toyota Motor Corp. Both governors expressed the necessity for the government to implement measures that would assist domestic businesses.

In response to the looming economic threat, the ruling Liberal Democratic Party (LDP) and coalition partner Komeito have outlined proposed actions aimed at bolstering cash flow for affected companies and enhancing communication within government agencies. LDP Policy Research Council chair Itsunori Onodera mentioned the call for a comprehensive policy package to address the anticipated economic fallout, commonly referred to as the “Trump shock.”

As the summer’s House of Councillors election approaches, both parties are keen to demonstrate their commitment to economic stability. The LDP has suggested measures to counter rising consumer prices, which involve strategies such as redirecting rice stockpiles and lowering gas prices, all while closely monitoring the effects of U.S. tariffs.

The government is actively working to provide necessary financial support to businesses grappling with a decline in exports, establishing around 1,000 consultation centers nationwide. Furthermore, it has relaxed loan requirements for the Japan Finance Corporation specifically aimed at smaller enterprises, while also extending targeted aid to auto parts manufacturers through subsidies and other incentives.

Should the U.S. tariffs remain in place for an extended period, the Japanese government may need to implement more drastic measures to foster business transformation, encourage new export markets, and preserve job security. Chief Cabinet Secretary Yoshimasa Hayashi stated the commitment to an all-encompassing national effort to support domestic industries during these challenging times.