Despite Nippon Steel, the US and Japan say ties are stronger than ever By Reuters

(Corrects Takeshi’s name, not Takashi, in paragraph 3 of the Jan. 7 story)

Posted by David Brunnstrom, Simon Lewis (JO:), Trevor Hunnicutt and Tim Kelly

TOKYO/WASHINGTON (Reuters) – The foreign ministers of Japan and the United States said their countries’ ties were stronger than ever on Tuesday, even after Japan’s prime minister called a decision by U.S. President States Joe Biden to block Nippon Steel’s offer of $ 14.9 billion for US Steel “confused.”

Biden’s move last Friday was a setback to US efforts to strengthen ties as the political crisis in South Korea could deepen the trilateral relationship between Washington, Seoul and Tokyo based on loans. ‘of China’s growing military power.

On Monday, Japanese Prime Minister Shigeru Ishiba expressed dismay at Biden’s decision, but after meeting in Tokyo on Tuesday, US Secretary of State Antony Blinken and Japanese Foreign Minister Takeshi Iwaya hailed the bilateral ties. and stronger than ever.

Speaking to the media, where no questions were asked, Blinken did not mention Nippon Steel, but a statement from Japan’s Foreign Ministry said he and Iwaya “exchanged views on economy, including the purchase of United States Steel (NYSE:) Nippon Steel Corporation.”

It said they “reaffirmed the importance of Japan’s economic relations with the US, including the investment of Japanese companies in the US”

Blinken said the two countries are “leading the way” in cooperation between like-minded countries and added: “I have great hope that it will continue for many years to come.”

After meeting with Ishiba at his home, Blinken did not respond to questions raised by reporters about the potential impact of Biden’s decision on bilateral ties.

Analysts say that while this could have a chilling effect on Japanese investment in the US, any damage to their broader relationship is likely to be mitigated by the two countries’ shared security concerns. China.

Businesses in Japan and the US have pushed hard for integration, supporting their arguments with warnings about the impact on the important US-Japan relationship.

But it still faced opposition from Biden and President-elect Donald Trump, who takes office on Jan. 20 and has been strongly supported by Japan during his re-election bid.

Before his trip, the State Department said Blinken wanted to build on the momentum of US-Japan-Korea trilateral cooperation.

In Seoul on Monday, Blinken expressed hope that South Korea is dealing with political unrest as investigators seek to extend the arrest warrant for President Yoon Suk Yeol.

Trump’s allies have also assured Seoul and Tokyo that they will support continued efforts to improve relations and advance military, economic and diplomatic cooperation to counter China and North Korea, Reuters reported ahead of the election. US.

DAMAGE, MORE DAMAGE FROM THE NIPPON STEEL DECISION

Nippon Steel and US Steel filed a lawsuit on Monday accusing Biden of violating the US Constitution by blocking their meeting with what they called a sham national security review. They asked the United States federal court to overturn the decision.

A Japanese expert told Reuters Biden could hurt foreign investment, but hoped the close US-Japan relationship would continue, with a strong push to build stronger ties with Trump seen during his previous administration, and taking advantage of the increasingly hawkish sentiment. Washington in China.

Nicholas Szechenyi, a Japan expert at the Washington Institute for Strategic and International Studies, said Japan will not allow the decision to damage US-Japan relations. “It is very important for Japan’s national security,” he said.

Trump repeated after winning the election that he was “absolutely” against the deal and vowed to block it as president and support US Steel with tax breaks and tariffs.

A former Trump administration official told Reuters he believed Trump would have taken a similar approach to Biden.

Marc Busch, a fellow at Georgetown University’s McDonough School of Business, predicts a “big fall” for US efforts to partner with partners to create resilient supply chains in the face of the regime of China or competition in key areas.

“Japan and other allies will have reservations about investing in or connecting to politically sensitive US supply chains,” he said. “China must be ashamed that it could not have hoped for a better outcome.”