Agency Report | Tokyo
TOKYO — Former US President Donald Trump arrived in Japan on Monday, continuing a high-stakes Asia tour that could yield a long-awaited trade breakthrough with China and potentially set the stage for renewed diplomacy with North Korea.
Markets and analysts are watching closely as Trump prepares for a face-to-face meeting with Chinese President Xi Jinping later this week — their first since Trump’s return to the White House — amid signals of progress from both sides.
Trump Seeks to Reset Asia Ties Amid Trade Optimism
Speaking aboard Air Force One en route from Malaysia, Trump said he was “hopeful of a deal” when he meets Xi on Thursday in the South Korean port city of Busan.
“I have a lot of respect for President Xi, and I think we are going to come away with a deal,” Trump told reporters, signalling a pragmatic tone after years of tariff disputes and tech tensions between Washington and Beijing.
His optimism follows two days of bilateral trade talks in Kuala Lumpur between US Treasury Secretary Scott Bessent and China’s Vice Premier He Lifeng. Officials later confirmed a “preliminary consensus” and a draft “framework” for the leaders to decide.
“It’s going to be great for China, great for us,” Trump said, as global markets responded with moderate gains on expectations of eased trade frictions.
Regional Diplomacy Picks Up Pace
Trump’s Asia tour began in Malaysia on Sunday, where he signed a series of trade and mineral cooperation deals, and endorsed a ceasefire pact between Cambodia and Thailand during the ASEAN summit — moves analysts view as part of Washington’s renewed economic diplomacy across Southeast Asia.
The White House has sought to reposition the United States as a counterweight to China’s growing regional influence through strategic investment and energy partnerships. A successful US–China trade accord could further stabilise global supply chains disrupted by years of tariffs, pandemic shocks, and geopolitical rivalry.
Focus on Japan’s Defence and Trade Agenda
Landing at Tokyo’s Haneda Airport at sunset, Trump — wearing his trademark golden tie — was greeted by cheering crowds before flying by helicopter to central Tokyo for an evening audience with the Emperor.
On Tuesday, he will meet Prime Minister Sanae Takaichi, Japan’s first female leader, and deliver a speech aboard the USS George Washington at the US Yokosuka naval base.
“I hear phenomenal things. Takaichi was a great ally and friend of Shinzo Abe, who was my friend,” Trump said. “That really helps Japan and the United States. I think she’s going to be great.”
Takaichi has announced plans to raise Japan’s defence spending to 2% of GDP this fiscal year — a sharp increase, though still below the 5% benchmark recently set by NATO members. The US, which maintains roughly 60,000 troops in Japan, is pressing Tokyo to expand both its defence posture and imports of US agricultural and automotive products, including rice, soybeans and Ford F-150 pickup trucks.
Questions remain over Japan’s $550 billion investment pledge in the US under a July trade deal, with Tokyo describing the figure as “aspirational” and Washington seeing it as central to bilateral economic ties.
Speculation Builds Over Possible Kim Jong Un Meeting
After Japan, Trump will head to South Korea for meetings with President Lee Jae Myung and to attend the Asia-Pacific Economic Cooperation (APEC) summit in Busan.
He has also hinted at the possibility of a surprise meeting with North Korean leader Kim Jong Un, their first encounter since a symbolic handshake at the Demilitarised Zone (DMZ) in 2019.
“I would love to meet with him if he’d like to meet,” Trump said. “I got along great with Kim Jong Un. I liked him. He liked me.” Asked whether he would extend his trip to accommodate the meeting, he added: “I hadn’t thought of it, but I think the answer would be yeah, I would.”
Markets Watch for Signals of Policy Shift
Global investors are watching for any clear sign that the Trump–Xi talks could ease existing tariffs or restart stalled trade mechanisms. Even partial concessions could lift Asian equities, commodities, and currency markets, analysts say.
“The rhetoric has clearly shifted from confrontation to negotiation,” said a Tokyo-based economist. “That alone is moving sentiment.”
A successful agreement in Busan would mark a major diplomatic win for Trump, reinforcing his “America First” trade strategy while restoring US economic influence across the Indo-Pacific.
For Asia’s policymakers and investors alike, this week’s meetings will test whether the veteran dealmaker can translate his confidence into tangible outcomes — or whether Washington and Beijing remain locked in a cycle of strategic rivalry.