As Washington and Beijing wage an intensifying trade war, Japan is caught in the middle of the fight.
Japan sells a large amount of cars to the United States, and computer chips and chip-making equipment to China. For the past two decades, the United States and China have alternated as the top destination for Japanese exports. No other country comes close.
Now, as President Trump tries to rally U.S. trade partners against China, and Beijing threatens countries that would heed that call, Japan faces a dilemma. Spurning either side would risk deeply unsettling its economy.
Japan was chosen by the Trump administration for its first face-to-face tariff talks, held last week. Mr. Trump is maintaining the threat of “reciprocal tariffs” that he imposed on dozens of countries and then paused until early July. In Japan’s case, that tariff is 24 percent, which government officials have said would cause a crisis for the country’s economy.
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This is not an entirely unfamiliar spot for Japan, which has been caught between the two economic giants as trade tensions between them have simmered over the past decade. Japan has walked a delicate path — taking steps to hedge its dependence on China while distancing itself from the politics of Washington.
Trade experts suggested that attempts to push Japan to rapidly or forcefully curtail its economic links with China would face significant resistance in Tokyo.
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