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Donald Trump announced Nippon Steel had abandoned its plan to buy US Steel but would “invest heavily” in the iconic Pittsburgh producer.
At a joint press conference with Japanese Prime Minister Shigeru Ishiba on Friday, the president said the prospect of an investment in US Steel was “very exciting”, adding he would meet Nippon officials next week.
“They’ll work out the details . . . I’ll be there to mediate and arbitrate,” he said.
Earlier on Friday, Trump said he had not changed his mind about opposing Nippon’s $15bn acquisition of US Steel. The companies last month sued the US after Joe Biden’s administration in January blocked the proposed deal.
One person familiar with the situation said details of the investment had not been finalised. The White House did not reply to a request for more information about what the two leaders had agreed. Nippon also declined to comment.
The United Steelworkers union, which was the biggest opponent to the proposed acquisition, said it remained concerned about Nippon Steel.
“Our union has had no contact with either company or the administration regarding reports of a Nippon investment in US Steel,” said David McCall, the union’s president.
McCall added: “Our concerns regarding Nippon’s continued interest in US Steel remain unchanged. Nippon has proven itself to be a serial trade cheater with a history of dumping its products into our markets.”
Two people close to the situation said that while a full takeover was off the table, negotiations would likely proceed towards a deal that shared “very similar” elements with the original proposed acquisition, and that US Steel would keep its name.
They added it was unclear whether that would absolve Nippon from the $565mn break fee it was due to pay if the deal failed to go through.
Earlier on Friday, Trump said he would consider hitting Japanese exports with tariffs if the US trade deficit with the Asian country was not eliminated and he pledged to unveil “reciprocal” tariffs on other nations next week.
Speaking in the Oval Office before the meeting with Ishiba, Trump said tariffs were an option to tackle the US trade deficit with Japan, the most important American ally in the Indo-Pacific. In 2024, the US deficit in goods with the country was $68bn, compared with $55bn in 2020 before the end of his first term.
Trump said Washington and Tokyo would work together to cut the trade deficit, saying “they want fairness also”.
Asked about the threat of tariffs, the president said: “We didn’t discuss tariffs too much.”
Ishiba said he was “unable to respond to a theoretical question” when asked whether Tokyo would retaliate.
Trump also said Japan would buy more US liquefied natural gas. Prompted by the US president, Ishiba agreed the Biden administration had made it harder for Japan to buy more American LNG. He said it was “wonderful” that more sales were being allowed.
On his first day in office, Trump signed an executive order to boost oil and gas production in Alaska, lifting Biden-era restrictions on drilling and prioritising the development of the state’s LNG sector, including granting permission for a pipeline and export terminal.
Japan, the world’s second-largest gas consumer after China, is among the biggest importers of American LNG, which is mostly sold under long-term contracts with foreign utilities.
The US government does not have a role in LNG sales. However, export capacity in the US, the largest in the world, is expected to nearly double from 2024 levels by 2028 as more terminals come online.
Ishiba said: “We also want to improve the trade deficit that the US has towards Japan, so if we are able to buy those [LNG] at a stable and reasonable price, it would be a wonderful situation.”
Beyond Japan, Trump said he would next week unveil “reciprocal tariffs” on unnamed countries, hinting at the universal levies he has vowed to impose on imports into the US.
The comments about new tariffs marked another escalation in Trump’s rhetoric, and brings the US closer to the brink of a multi-front trade war with some of its closest trading partners and security allies.
“I’ll be announcing that next week, reciprocal trade, so that we’re treated evenly with other countries,” Trump said. During the presidential campaign last year, he repeatedly warned he would impose a universal tariff on imports into the US.
Earlier this week, Trump suspended until March 1 his plan to impose steep tariffs on Mexico and Canada, the US’s two largest trading partners, but proceeded with a 10 per cent levy on imports from China. Beijing responded with retaliatory tariffs that will take effect this weekend.