If concern grows over a trade war between the world's top two economic powers -- the United States and China -- it will have a serious impact on the world economy.
The United States should reexamine its unilateral protectionist policy while China and other U.S. trade partners should deal with the situation with cool heads and based on international rules.
Washington has invoked tariffs to restrict imports of steel and aluminum from an extensive range of trading partners, including Japan. U.S. President Donald Trump also signed a presidential directive aiming to slap large-scale tariffs on a wide range of Chinese products.
With midterm elections set for this autumn, Trump apparently gave consideration to workers in the manufacturing industry who are his support base.
The Nikkei Stock Average temporarily plunged by more than 1,000 points on Friday on concern about stagnation of world trade, among other things.
Trump's stance of disregarding the international impacts of his policy by trumpeting the "America First" slogan is extremely irresponsible.
Tariffs would raise import prices and this would amount to a de facto tax increase for U.S. consumers. If consumption cools off, it will not benefit manufacturers, either.
Before trade frictions come into full swing, Washington should recognize the major adverse impacts that could be caused by its hard-line measures.
China, highlighted as a main target for U.S. tariffs, assumes a stance of having no hesitation to take retaliatory measures. Without engaging in a sanctions battle with retaliatory high tariffs, China should deepen negotiations with the United States at such forums as the World Trade Organization.
Japan must rebuild strategy
With regard to China's infringement of intellectual property rights and overproduction of steel, over which Washington takes issue with Beijing, Japan and the European Union also have long called for a correction.
China emphasizes the results of its crackdown on counterfeit products and other control measures, but many problematic aspects have been pointed out anew in such fields as technology transfer in the information technology industry.
To prevent the situation from worsening, it is essential for the Chinese administration to work toward nipping trade frictions in the bud.
Japan is not included in the current list of countries that are exempted from U.S. steel import restrictions. There is no alternative but to persistently call for the U.S. side to add Japan to the list.
The relationship of mutual trust between Prime Minister Shinzo Abe and Trump is the basis for the two countries to deal with foreign policy and security issues. But when it comes to trade policy, Trump has taken a serious view of trade deficits with Japan and adopted an obstinate stance, so special consideration to Japan cannot be expected from him.
Keeping this reality in mind, Japan is called on to rebuild its trade strategy.
To begin with, it is urgent to have the Trans-Pacific Partnership free trade agreement among 11 countries, excluding the United States, take effect. This would provide a foundation for the United States to return to the free trade framework.
Tokyo must study concrete plans to enter bilateral free trade negotiations with Washington based on the TPP agreement.
Japan is called on to work out measures strategically by utilizing such bilateral forums as the Japan-U.S. Economic Dialogue between Deputy Prime Minister Taro Aso and Vice President Mike Pence.
(From The Yomiuri Shimbun, March 24, 2018)
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