In a stunning move that has rattled Washington and global markets, Japan’s new Prime Minister, Sanai Takayichi, has scrapped former President Donald Trump’s $550 billion trade deal, calling it “unfair and against national interests.” The decision signals a major shift in U.S.-Japan relations and questions America’s economic dominance in Asia. Takayichi, Japan’s first female prime minister, insists Tokyo must retain control over its investments and reject deals that undermine sovereignty.
Analysts warn Japan’s stance could embolden other U.S. allies like South Korea and Taiwan to reassess their agreements with Washington. The yen tumbled and Wall Street reacted nervously following Japan’s announcement.
Takayichi’s administration emphasized that Japan’s development bank—not Washington—would decide which projects to fund, defying Trump’s expectations of full U.S. oversight. The move underscores Japan’s growing desire for autonomy and a more balanced partnership with the U.S.
Observers say this marks more than an economic dispute—it’s a symbolic declaration that America’s allies are beginning to assert independence, potentially signaling the dawn of a new power dynamic across the Pacific.
