Japan and the US have agreed on the first three megaprojects of their $550 billion investment package. Trump celebrates it as proof of his tariff policy. Tokyo is under pressure – and pays.
❝"The scale of these projects are so large, and could not be done without one very special word, TARIFFS."
Donald Trump, US President
The three projects
Project | Location | Volume | Details |
|---|---|---|---|
Gas power plant | Portsmouth, Ohio | $33 billion | 9.2 GW – world's largest, SoftBank |
Crude oil terminal | Gulf of Mexico | $2.1 billion | $30 billion annual revenue, Sentinel Midstream |
Diamond factory | Georgia | $600 million | Synthetic diamonds, Element Six |
The gas power plant alone equals nine nuclear reactors and could supply 7.4 million households. Japanese companies like Toshiba, Hitachi, and Mitsubishi Electric are to deliver turbines.
The fine print
The profit participation is extremely one-sided. After repayment of the initial investment, the profit split shifts to 90:10 in favor of the US, according to reports.
- Additionally, after Trump's approval, Tokyo has only 45 days to physically transfer the promised funds.
⚠️ Reality check
"Strategic, but hardly bankable," is how Japanese financial circles describe the projects. Politicians and corporate leaders have openly criticized Trump's tactics as "blackmail."
But dependence on the US market and especially Washington's security policy role against China, North Korea, and Russia left no choice.
The China Survival Guide for Western Businesses
Entity setup, WeChat strategy, hiring your first local team. 12+ years on the ground in Shanghai.
