HIGHER U.S. tariffs on Japanese car exports are less likely now the two nations agreed to start new trade talks, economists said, but most think U.S. trade friction with China and other economies will have a significant impact on Japan.

The United States had threatened to slap 25 percent tariffs on auto exports from Japan but Washington agreed not to do so while fresh trade talks are underway.

U.S. President Donald Trump has made clear he is unhappy with Japan’s US$69 billion trade surplus with the United States — nearly two-thirds from cars.

Twenty-seven of 35 analysts said the chance of higher American tariffs on Japanese cars declined “significantly” or “to some extent,” the Oct. 3-12 poll showed.

But many analysts predicted Washington may still raise tariffs, which currently stand at 2.5 percent on Japanese autos and a 25 percent tariff on trucks.

“There is no change in Washington’s stance that it is demanding Japan cut its trade surplus with the United States,” said Atsushi Takeda, chief economist at Itochu Economic Research Institute.

“So there is still a chance that Washington will execute some kind of restrictions on Japan’s auto exports to the United States, including higher auto import tariffs,” he said.

In a trade war between China and the United States, Trump warned there was much more he could do that would hurt China’s economy further, showing no signs of backing off an escalating trade war with China.

Asked about the negative impact from such trade friction on Japan, 25 of 34 economists projected it would be “very significant” or “significant,” the poll found. (SD-Agencies)