US President Donald Trump announced what he called a “massive” new trade agreement with Japan on Tuesday. According to Trump, the deal involves a 15 percent reciprocal tariff and promises Japanese investments worth $550 billion into the United States.

Deal Covers Key US Exports

In a post shared on his social media platform, Truth Social, Trump said the agreement would give the US more access to Japan’s market. It includes American products such as cars, trucks, rice, and other agricultural goods.

“We just completed a massive deal with Japan, perhaps the largest deal ever made,” Trump wrote. “Japan will invest, at my direction, 550 billion dollars into the United States, which will receive 90 per cent of the profits. This deal will create hundreds of thousands of jobs — there has never been anything like it.”

He further stated, “Perhaps most importantly, Japan will open their country to trade — including cars and trucks, rice, certain agricultural products, and other items. Japan will pay reciprocal tariffs to the United States of 15 per cent.”

High-Level Talks at the White House

Trump’s announcement came shortly after a meeting with Japan’s top trade negotiator, Ryosei Akazawa, at the White House on Tuesday. The deal is expected to take effect starting August 1.

Tariff Lower Than Earlier Threats

Although the 15 percent tariff is still significant, it is lower than the 25 percent Trump had earlier threatened. However, it still goes against Japan’s earlier request to be fully exempt from US tariffs.

The new tariff is also part of a broader effort by Trump to introduce reciprocal tariffs against several major global economies.

Japan’s Political Uncertainty Looms

The announcement comes at a time when Japan is facing political uncertainty. Prime Minister Shigeru Ishiba’s ruling Liberal Democratic Party recently suffered a major loss in upper house elections, raising concerns about Japan’s ability to move forward with the deal.

Concerns Over Additional Tariffs

It is still unclear whether this 15 percent tariff will be added to other duties Trump had proposed in the past. These include a 25 percent tariff on cars and a 50 percent duty on steel — two areas that are vital to Japan’s economy and have been key issues in ongoing US-Japan trade discussions.