The Japanese government announced on the 5th that it welcomes President Donald Trump's signing of an executive order to implement the Japan-U.S. trade agreement.

Japanese Prime Minister Shigeru Ishiba. AFP Yonhap News. 

Prime Minister Shigeru Ishiba told reporters that day, "We have been coordinating to achieve a swift reduction of tariffs by the United States," adding, "This was our top priority."

Prime Minister Ishiba stated that to realize an early reduction of tariffs by the U.S., two documents were prepared accepting the U.S. side's requests, and said, "This is very meaningful from the perspective of explaining it in a way that the public can understand."

Regarding Japan's $550 billion (approximately 766 trillion won) investment in the U.S., which has shown a significant divergence in interpretation between the two countries, he reported that Ryosei Akazawa, Minister of Economic Revitalization, who is visiting the U.S., and Howard Rutnik, U.S. Secretary of Commerce, signed a Memorandum of Understanding to confirm common understanding.

Furthermore, a joint statement was also prepared to reaffirm the agreement between the two countries and was sent to President Trump along with a personal letter through Representative Akazawa.

Prime Minister Ishiba introduced the personal letter sent to President Trump, stating, "It conveys the desire to jointly usher in a golden age of Japan-U.S. relations and my invitation for President Trump to visit Japan."

Chief Cabinet Secretary Yoshiimasa Hayashi, the Japanese government spokesperson, also said at a regular press conference that day, "This presidential decree is a faithful implementation of the agreement reached between the two countries on July 22," and added, "We welcome it."

Regarding the joint statement, which is being created separately from the investment MOU, he explained, "It will also specify that regarding semiconductors and pharmaceuticals, we will not impose tariffs disadvantageous compared to other countries in the future, and that aircraft and aircraft parts will not be subject to tariffs."

Previously, the executive order signed by President Trump on the 4th (local time) stipulated a reduction of the 25% item-specific tariff imposed on Japanese automobiles and automobile parts to 15%.

Currently, the U.S. has been applying a total tariff of 27.5% on Japanese cars, combining the existing 2.5% with the 25% item-specific tariff, and this will be reduced to 15%.

The definition of "reciprocal tariff" imposed on Japan has also been clarified.

According to the executive order, for items where the existing tariff is less than 15%, the combined tariff rate of the existing tariff and the reciprocal tariff will not exceed 15%.

For items where the existing tariff is 15% or more, reciprocal tariffs will not be added. This is the same treatment as the European Union (EU) and is what Japan had sought.

According to the White House, President Trump instructed that procedures such as modifying the Harmonized Tariff Schedule of the United States (HTSUS) be completed within seven days of the executive order being published in the Federal Register.

However, regarding the timing of the application of the new automobile tariffs, Minister of Economic Revitalization Akazawa said, "I cannot say definitively, but I believe it will be within two weeks at the maximum."

Regarding the investment MOU, he explained, "There is no change in providing investments, loans, and loan guarantees up to $550 billion." (Reporting assistance: Kim Ji-soo, Correspondent)

Yonhap News