Japan's Prime Minister expresses significant concerns to Biden regarding the steel agreement

Kathmandu. Japanese Prime Minister Shigeru Ishiba expressed significant concerns to US President Joe Biden regarding the latter's decision to block Nippon Steel's acquisition of US Steel, as reported by local media on Monday.

This discussion occurred during a three-way call that also included the President of the Philippines, and it addressed China's "dangerous and unlawful" actions in the region, according to the White House.

Biden's recent rejection of Nippon Steel's $14.9 billion bid was justified by national security considerations, which has caused discontent in Japan, a close ally of the United States that hosts approximately 54,000 American military personnel. Ishiba conveyed to reporters that there are "strong voices of concern" not only in Japan but also within the US business community, urging Biden to alleviate these apprehensions.

The blocking of a takeover by a Japanese company is an uncommon occurrence, and both Nippon Steel and US Steel have initiated legal proceedings, alleging "illegal interference" by the outgoing US administration. Nippon Steel had presented the acquisition as a crucial support for its struggling American counterpart, although critics warned that the Japanese firm would likely reduce jobs, despite its assurances to the contrary.

The proposed acquisition, announced in 2023, became a contentious political issue leading up to last year's US presidential election, particularly as US Steel is located in Pennsylvania, a key swing state, with both Donald Trump and Kamala Harris opposing the deal.

In a broader context, Japanese investments in the United States reached nearly $800 billion in 2023, representing the highest investment from any country and accounting for 14.3 percent of the total, according to US government data. Additionally, US companies are the largest foreign investors in Japan. Japan remains a vital strategic ally for the United States as it seeks to counter China's influence in disputed regions of the South China Sea. Both steel companies announced on Sunday that US authorities have extended the deadline for unwinding the acquisition until June 18. Japan's Foreign Minister Takeshi Iwaya is expected to attend Trump's inauguration as US president.