A look at Japan's upper house election, trade policies and economic outlook

CGTN Europe spoke to Naoyuki Yoshino, Emeritus Professor of Economics at Keio University, Japan.

Transcript

00:00Naoki Yoshino is Professor Emeritus at Japan's Kiyo University.

00:05I think even within LDP, his party, there are lots of opinions.

00:11Whether Mr. Ishiba, current Prime Minister, should remain in their power or he should resign.

00:19Of course he's saying continuation is very important

00:22because Japan is negotiating with President Trump for in these two, three months.

00:29So continuation is important, that is what he's saying.

00:32However, even within LDP, this big loss is mainly caused by the bad announcement

00:40and bad opinions by this Prime Minister.

00:45So even though he's going to stay in the power,

00:48that we are not sure whether he will be able to do it or not.

00:52And at the same time, opposition party won in this election.

00:57That means his policy was strongly criticized by the general public.

01:04So even if he stays in his power, he needs lots of new policies and also structural reforms.

01:12These tariff negotiations are ongoing between Japan and the United States.

01:17There's a tariff deadline looming.

01:20The truth is Japan's position and leverage is now greatly weakened, isn't it?

01:25The United States is facing a lame duck Prime Minister across the negotiating table.

01:31Yes, I think President Trump's tariff policy, from the economist's point of view,

01:41is not based on economics.

01:43He's very much politically oriented.

01:47And President Trump is only focusing on trade issues rather than services sector.

01:54In services sector, Japan has huge deficits against the United States,

02:01even though manufacturing products are exporting much more than we import from the United States.

02:09So theoretically economic theory point of view,

02:12trade balance and also services balances should be included in the discussion.

02:18However, President Trump is only focusing on goods part rather than services sector.

02:26And it is very damaging for Japan, especially in auto industries and small businesses who are supporting those industries.

02:36So I think negotiations will be needed and how to compromise the President Trump's main idea

02:46and what should we do for Japan to import.

02:51And one of the directions is many manufacturing industries in Japan is going to move from Japan to United States

03:00and then their products could be imported into Japan.

03:05That may be one of the compromises to reduce the tariffs between Japan and United States.