Japan To Offer US Rare Earth, LNG Deal To Ease China Trade War Tensions At Tariff Talks: Report

In an attempt to alleviate the impact of the U.S.-China trade war, Japan is reportedly set to propose a cooperation package to the U.S. at the upcoming tariff negotiations.

What Happened: Japan’s top trade negotiator, Ryosei Akazawa, is scheduled to present the U.S. with a cooperation package. The package will target supply chains for Chinese rare earths and U.S. liquefied natural gas (LNG), both of which have been affected by ongoing U.S.-China tensions, reported Nikkei Asia on Thursday.

China has limited exports of seven rare earth elements and stopped purchasing U.S. LNG. In response, Japan seeks to tackle these disruptions and redirect attention toward China—the main target of President Donald Trump‘s tariffs—in an effort to gain concessions.

Akazawa left for the U.S. on Thursday to propose Japan’s cooperation regarding China issues at the upcoming negotiations. Japan has previously requested the U.S. to re-evaluate the additional tariffs imposed through four meetings, primarily focusing on securing critical materials essential for industrial activity.

Japan’s proposals include providing its strengths in processing, recycling, and reducing the usage of rare earths to the U.S. It is also considering expanding imports of U.S. LNG and purchasing semiconductor products worth billions of dollars from U.S. companies, including Nvidia NVDA.

Why It Matters: Japan’s move to propose a cooperation package comes after the country announced a significant economic stimulus package to counter the impact of heightened U.S. tariffs. The government allocated $6.3 billion for emergency economic measures, marking Japan’s first fiscal response to the trade duties imposed by President Trump.

Japan’s proposal to import nearly $7 billion worth of U.S.-made semiconductors could significantly benefit chipmakers like Nvidia and Advanced Micro Devices AMD amid ongoing trade negotiations with the Trump administration.

Meanwhile, the U.S. Vehicle Suppliers Association has urged immediate measures to address China’s limited rare earths exports, warning of potential disruptions in auto parts production.