Written by The Banking Post
US President Donald Trump on Tuesday praised Japan’s newly elected prime minister Sanae Takaichi, calling her leadership “great” as the two nations signed a landmark rare earths and trade deal in Tokyo.
Takaichi, Japan’s first female leader and a close ally of the late Shinzo Abe, pledged to accelerate Japan’s military buildup, committing to raise defence spending to 2% of GDP. Her move aims to strengthen Tokyo’s security posture amid growing regional tensions and align more closely with Washington’s Indo-Pacific strategy.
The meeting produced several new cooperation projects in energy, artificial intelligence, and critical minerals, with Japanese firms planning up to $400 billion in US investments. Earlier this year, Tokyo had already pledged $550 billion in strategic investments, loans, and guarantees to secure relief from Trump’s steep import tariffs.
According to Trump’s spokeswoman Karoline Leavitt, Takaichi praised Trump’s efforts to resolve global conflicts and even vowed to nominate him for the Nobel Peace Prize.
Analysts say the series of deals marks a new phase in US-Japan economic and defence ties, as both governments look to reduce dependence on China for key resources while reinforcing strategic cooperation.
