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Japan seeks exemption from planned US auto tariffs, Motegi hints

Japanese economic revitalization minister Toshimitsu Motegi speaks to the press after meeting with U.S. Trade Representative Robert Lighthizer, in Washington, on Aug. 10, 2018. (Kyodo)

WASHINGTON (Kyodo) -- Japanese economic revitalization minister Toshimitsu Motegi indicated Friday he has requested that the United States exempt Japan from a controversial plan to impose stiff tariffs on car and parts imports.

Speaking after he met U.S. Trade Representative Robert Lighthizer in Washington, Motegi said the two sides were apart over auto and agricultural trade and agreed to meet again in September.

In comments taken as urging Washington not to hit Tokyo with additional levies of up to 25 percent on imported cars and parts, on top of global tariffs on steel and aluminum, Motegi said he "made it clear to the U.S. side that it is indispensable for Japan and the United States to ensure confidence-building in trade policy."

"We agreed to continue consultations based on the relationship of trust," he told journalists.

The comments came after two days of discussions in a first round of bilateral trade talks. Motegi and Lighthizer will hold the second round in September, likely before an anticipated meeting between Japanese Prime Minister Shinzo Abe and U.S. President Donald Trump on the sidelines of the U.N. General Assembly, according to the Japanese minister.

A statement issued by the Office of the USTR said that Motegi and Lighthizer "agreed to continue the consultations based on mutual trust and to further deepen the discussions in the next round of the ministerial consultations to be held sometime in September."

Last month, the European Union won exemption from Trump's planned tax on imported cars and parts. If Trump follows through with the plan after a Section 232 national security investigation into automobile and parts imports, the new duties would significantly impact major car exporters such as Japan.

During the trade talks, Motegi and Lighthizer "agreed to explore ways to fill the gap between their positions and to promote trade between the United States and Japan," the USTR statement said, without mentioning their differing views on the Trans-Pacific Partnership or auto and farm trade.

Motegi said he told Lighthizer that the TPP -- an 11-member regional trade pact from which Trump withdrew the United States last year -- may come into force early next year.

During the first day of talks, Motegi called for a U.S. return to the TPP, saying it is the best trade deal for the two countries.

But Lighthizer pushed for a bilateral trade deal as a way of reducing the chronic U.S. trade deficit with Japan.

The U.S. goods trade deficit with Japan totaled $68.85 billion in 2017, the third-largest among countries with which the United States generated a trade deficit, according to Commerce Department data.

Asked if Lighthizer pressed Japan to increase market access for U.S. farm products such as beef and soybeans, Motegi acknowledged the two ministers exchanged views on specific sectors in a candid way, but only said, "Nothing has been decided on individual issues."

Asked if Japan proposed increasing imports of defense equipment and liquefied natural gas from the United States, Motegi did not rule out such a possibility, saying, "It is possible to discuss issues that are not necessarily related to general rules on trade."

Motegi said he and Lighthizer agreed to further promote bilateral cooperation on international economic issues, citing unfair trade, coercive technological transfer, violation of intellectual property rights and matters involving state-owned enterprises in a veiled reference to China's widely criticized trade practices.

They also agreed to cooperate in reforming the World Trade Organization.

In line with an agreement between Abe and Trump during their April summit in Florida, Motegi and Lighthizer are tasked with leading new consultations on trade and investment for a "free, fair and reciprocal" trade deal.

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