Suntory Head Criticizes Japan's Tariff Negotiation Strategy With US

Takeshi Niinami, the head of Suntory and chair of the Japan Association of Corporate Executives, has criticized Japan's approach in negotiations with the U.S., calling it a "big mistake." Niinami argued that Japan's demand for complete relief from the tariffs proposed by President Donald Trump left American negotiators feeling "betrayed." He suggested that accepting a 10% minimum tariff, instead of insisting on zero, might have yielded more advantageous conditions. "They underestimated the determination of Trump," he said. "They thought time was on Japan’s side. It was a big mistake."

Niinami warned that with 25% tariffs looming, Japan’s negotiating power is weaker and it might have to give in to strike a deal. He also noted that there’s less time to reach a deal before the July 20 upper-house election, when the ruling party could lose its majority. "It could be too late," he said.

Earlier in the year, the Japanese government swiftly initiated talks, aiming for a swift pact that would shield exporters from Trump’s threatened tariffs. However, the U.S. administration imposed a 25% duty on imports from Japan, one percentage point higher than the April proposal, after negotiations failed.

Trump introduced “reciprocal” tariffs for several Asian countries, including South Korea, Malaysia, Thailand, and Indonesia. Originally announced in April but postponed until July 9, these updated duties are set to be implemented on August 1.

Strategists observed that Tokyo may struggle to concede more in talks as the July 20 election draws near. The governing coalition is compelled to safeguard vital sectors, namely automotive exporters and rice producers, whose backing is essential.

Negotiations between Tokyo and Washington have dragged on for weeks, even as officials on both sides privately claimed advances. In recent days, Trump criticized Japan as “spoiled,” reproaching its reluctance to increase U.S. rice imports or grant entry to American-made vehicles.

Niinami also criticized Japan’s inflexible farm policies. He argued that the refusal to prioritize the interests of rice growers over the auto industry weakened the late prime minister Shinzo Abe’s efforts to foster close ties with Trump. "Trump had high expectations of Japan because of Mr. Abe, [and believed] Japan could become a showcase," Niinami said. "We needed to analyze that level of expectation."

During discussions, Tokyo pushed for total exemption from the American tariffs, contending that the bilateral alliance warranted preferential treatment. Sources in both Washington and Tokyo indicate that lead negotiator Ryosei Akazawa, despite extensive calls and in-person negotiations, lacked the mandate to make concessions on duty rates.

Supporting Niinami’s assessment, a former U.S. trade representative said Tokyo’s insistence on removing every levy was a grave misjudgment. He characterized that stance as “a fantasy,” and warned, “If Japan wants to reach a deal by August 1, it needs to be more pragmatic.”

On Tuesday, Akazawa spent about forty minutes meeting the U.S. Commerce Secretary. Officials in Tokyo noted that he was “permanently ready” to travel to Washington for further negotiations.

In early May, the chair of the Japan Business Federation recommended a “prompt but measured approach by hanging tough, digging in and negotiating with a sense of resolve.” At the same time, a member of multiple leading corporations argued that a softer yen would cushion the impact of the duties. He observed that he would “be happy to take 145 yen in exchange for the tariffs,” compared to about 110 yen to the dollar during Trump’s first term.