US Treasury: "Quarterly evaluation with Japan... will return to 25% if Trump is dissatisfied"

"If auto tariffs are 25%, Japan's economy won't function... US will earn significant tariff revenue even at 15%."

"Discussions on China's market opening and China's purchase of Iranian/Russian oil at US-China talks on the 28th-29th."

US Treasury Secretary Scott Bessant [Yonhap News Agency file photo. Reproduction and database prohibited]

(Washington=Yonhap News) Reporter Park Sung-min = US Treasury Secretary Scott Bessant warned on the 23rd (local time) that if the trade agreement reached with Japan is not properly implemented, tariffs will return to the originally set 25%.

In an interview with Fox News, Secretary Bessant said, "We will evaluate quarterly, and if the President is not satisfied, the tariff rates on automobiles and other products will return to 25%."

He added, "For automobiles, the Japanese economy will not function at a 25% tariff."

Japan has reached a trade agreement with the US to reduce the reciprocal tariff rate on its exports to the US by 10 percentage points from the 25% initially set by US President Donald Trump, to 15%. Japan has also pledged to invest $550 billion (approximately 759 trillion won) in the US.

Secretary Bessant stated, "Even at a 15% tariff rate, (the US) can earn significant tariff revenue," and explained that the trade agreement with Japan "includes three elements: economic opening (by Japan), a $550 billion joint partnership where the US accounts for 90% of the revenue, and a 15% tariff on all products Japan sells to us."

Regarding how Japan's investment in the US will be used, Bessant explained, "It will be through loans, credit guarantees, and equity investments. President Trump will direct where this funding will be invested, and it will be invested in mitigating supply chain crises, including in critical minerals, pharmaceuticals, semiconductors, and shipbuilding."

Concerning the third high-level trade talks with China to be held in Stockholm, Sweden, on the 28th-29th, Secretary Bessant said, "China is the second-largest economy in the world with a population of 1.4 billion. We want to bring precision manufacturing back to the US, and the more products we produce, the more we will need new, large markets to sell them. Therefore, I believe President Trump has the potential to be the president who opens up the Chinese market."

He added, "We will discuss market opening, but we will also discuss issues such as their purchase of oil from Iran or Russia, which are subject to sanctions."

Meanwhile, regarding the nomination of a successor to Federal Reserve (Fed) Chairman Jerome Powell, who has been criticized by President Trump for not lowering benchmark interest rates, Bessant said, "We will likely announce a candidate for the new Fed chairman in December of this year or January of next year. From that point on, markets will pay attention to the statements of the future Fed chairman."

min22@yna.co.kr

(End)

(Copyright (c) Yonhap News, Unauthorized reproduction, redistribution, and AI learning and utilization prohibited)