Japan's Emergency Economic Response to U.S. Tariffs

Japan's Prime Minister Shigeru Ishiba announced an emergency economic package to mitigate the impact of U.S. import tariffs. The package includes subsidies and low-interest loans for affected industries and households. Further measures may be introduced depending on the tariffs' effects, particularly on the automotive sector.

Japan's Prime Minister Shigeru Ishiba unveiled an emergency economic strategy on Friday, designed to ease the potential impacts of new U.S. import tariffs on both industries and households. According to a government document, the package proposes vital measures such as subsidies to reduce gasoline costs by 10 yen ($0.07) per liter, and partial funding of electricity bills for three months beginning in July.

To support small and medium-sized enterprises more susceptible to economic fluctuations, the government is broadening the eligibility for low-interest loans provided by state-backed banks. Prime Minister Ishiba emphasized his directive to cabinet members to prioritize assistance to groups concerned about the ramifications of tariffs, which pose significant risks to core sectors like automobiles and steel. The administration is also contemplating further initiatives to stimulate domestic consumption, contingent upon the impact on Japan's substantial automotive industry.

Economy Minister Ryosei Akazawa disclosed that Friday's package could be financed through a reserve fund, circumventing the need for an additional budget. U.S. President Donald Trump's recent tariffs—including a 25% duty on car and truck imports and a subsequent 10% levy on all Japanese goods for 90 days—heightened tension. Akazawa, Japan's chief trade negotiator, is slated to visit Washington for continued negotiations, amidst reports of potential increased soybean imports from the U.S.

(With inputs from agencies.)