U.S., Japan Sign Two New Trade Agreements

On October 10, 2019, in International Trade, by David Elrod

The United States and Japan on Monday signed two new agreements on trade as the countries work on details of a broader agreement in the coming months.

Under the agricultural export agreement, frozen U.S. chicken will be among the agricultural products that will benefit from staged tariff elimination. The current 8.5 percent tariff on frozen bone-in leg quarters will be eliminated within 11 years; the 11.9 percent tariff on frozen boneless leg quarters will be eliminated in six to 11 years; the current 11.9 percent tariff on frozen whole birds will be eliminated within 11 years.

The two countries also signed a separate agreement on digital trade. Neither agreement required Congressional approval. They are set tot take effect on January 1, 2020.

The agreement does not have to be approved by the U.S. Congress, but it does have to be approved by the Japanese Diet. The Diet convened what is known as an extraordinary session on October 4, 2019 to consider the agreement. The extraordinary session is set to end on December 10, 2019.

According to USDA, U.S. chicken exports to Japan in 2018 were 19,265 metric tons valued at $32.5 million. Fully removing tariffs would stand to benefit the U.S. industry and lead to increased exports of U.S. chicken products.