Japan is one of the world’s most successful democracies and largest economies. The U.S.-Japan Alliance is the cornerstone of U.S. security interests in Asia and is fundamental to regional stability and prosperity. The Alliance is based on shared vital interests and values, including: the maintenance of stability in the Indo-Pacific region: the preservation and promotion of political and economic freedoms; support for human rights and democratic institutions; and, the expansion of prosperity for the people of both countries and the international community as a whole.
Bilateral Economic Relations
The U.S.-Japan bilateral relationship features substantial trade and investment flows. However, the United States’ goods trade deficit with Japan is its third-largest one in the world. U.S. economic policy toward Japan seeks to address this trade deficit through free, fair, and reciprocal trade. In particular, the U.S. aims to expand access to Japan's markets, increase two-way investment, stimulate domestic demand-led economic growth, promote economic restructuring, improve the climate for U.S. investors, and raise the standard of living in both countries. Japan represents a major market for many U.S. goods and services, including agricultural products, chemicals, pharmaceuticals, films and music, commercial aircraft, nonferrous metals, plastics, medical and scientific supplies, and machinery. U.S. imports from Japan include vehicles, machinery, optic and medical instruments, and organic chemicals. U.S. direct investment in Japan is mostly in the finance/insurance, manufacturing, and wholesale sectors. Japanese direct investment in the United States is mostly in the wholesale trade and manufacturing sectors.