Washington [US], July 23 (ANI): US President Donald Trump on Tuesday night (local time) announced the completion of what he called a 'massive deal' with Japan, potentially 'the largest deal ever made,' following intense and protracted negotiations between the two nations.

In a post on Truth Social, Trump stated, 'We just completed a massive Deal with Japan, perhaps the largest Deal ever made. Japan will invest, at my direction, $550 Billion Dollars into the United States, which will receive 90% of the Profits. This Deal will create Hundreds of Thousands of Jobs -- There has never been anything like it.'

Shortly after the announcement, CNN reported, Trump addressed a reception with Republican members of Congress in the East Room of the White House, saying, 'I just signed the largest trade deal in history; I think maybe the largest deal in history with Japan. They had their top people here, and we worked on it long and hard. And it's a great deal for everybody.'

As per CNN, the agreement entails a 15% 'reciprocal' tariff on Japanese goods exported to the US. President Trump stated that the US will 'will receive 90% of the profits.'

According to CNN, the agreement marks a breakthrough after months of stalled negotiations with key trading partners, as Trump's August 1 deadline for higher tariffs approached. The Japan deal was one of three major trade developments Trump announced that day.

Trump stated that Japan would open its market to U.S. trade, including automobiles and agricultural products. 'Perhaps most importantly, Japan will open their Country to Trade including Cars and Trucks, Rice and certain other Agricultural Products, and other things. Japan will pay Reciprocal Tariffs to the United States of 15%.'

Calling it a significant development for bilateral ties, Trump said, 'This is a very exciting time for the United States of America, and especially for the fact that we will continue to always have a great relationship with the Country of Japan. Thank you for your attention to this matter!'

Trade in rice had emerged as a major sticking point during the talks. 'They won't take our RICE, and yet they have a massive rice shortage,' Trump posted last month on Truth Social. CNN reported that Japan bought $298 million worth of US rice last year and $114 million between January and April this year.

A 2021 report by the Office of the United States Trade Representative under former President Joe Biden had stated, 'Japan's highly regulated and non-transparent system of importation and distribution for rice limits the ability of US exporters to have meaningful access to Japan's consumers.'

Automobiles, a pillar of Japan's economy, were also central to the discussions. 'We didn't give them one car in 10 years,' Trump said earlier this month. However, CNN cited data from the Japan Automobile Importers Association showing Japan imported 16,707 American-made vehicles last year.

US Treasury Secretary Scott Bessent met Japanese Prime Minister Shigeru Ishiba in Tokyo last week and expressed optimism about a breakthrough. In a post on X, Bessent said, 'A good deal is more important than a rushed deal, and a mutually beneficial trade agreement between the United States and Japan remains within the realm of possibility.'

Mary Lovely, a trade expert at the Peterson Institute, told CNN the deal relieved Japan of tariff pressure. 'The 'deal' relieves Japan of the 25% tariff threat and puts it potentially in a competitive position vis a vis similar US suppliers,' she said. 'The US is unlikely to sell many cars and trucks... from the US. Agricultural liberalization (is) a win for Japanese consumers, assuming they are willing to try excellent California rice.'

CNN noted that Japan is one of the US's most significant trading partners, and the fifth-largest source of imports. Last year, Japan shipped $148 billion worth of goods to the US, including cars, car parts, and agricultural and construction machinery.

Goods from Japan had faced a 24% reciprocal tariff before Trump initiated a 90-day pause in April. Since then, they have been subject to a minimum 10% tariff. Earlier this month, Trump warned in a letter to Prime Minister Ishiba that he could impose a 30% tariff starting August 1, CNN reported.

In return, the US exported $80 billion worth of goods to Japan last year, including oil and gas, pharmaceuticals, and aerospace products.

While Japan is a close ally of the US, its top trading partner is China. CNN reported that the Trump administration had been urging its allies to reduce trade with China as a condition for securing trade deals with Washington.

The agreement follows a 2019 expanded trade pact between the two countries that went into effect the following year, allowing more goods to be shipped duty-free. Japan also holds $1.1 trillion in US Treasury securities, making it the largest foreign creditor to the United States. (ANI)