President Trump signed an executive order putting the July framework into effect, including a 15% all-in tariff on most Japanese goods and on cars and auto parts. The two governments also signed a memorandum on the $550 billion investment program. Under it, a committee chaired by the U.S. commerce secretary recommends projects, the president selects them, and Japan has 45 business days to provide funding. Cash flows are split 50/50 until a set amount is recovered, then 90% to the U.S. and 10% to Japan. What was agreed Each selected project is to be held in its own US special purpose vehicle, governed by the United States or parties it designates. According to analyses of the text by CSIS and the Korea Economic Institute of America, the vehicles pay out cash flows net of US taxes, split equally until Japan's "deemed allocation amount" is reached, after which 90% goes to the US and 10% to Japan. A Hudson Institute paper noted that Japan keeps its 10% for the life of the project and argued that this makes Japan's position look more like a lender than an equity owner. A consultation body with Japanese and U.S. members, expected to include JBIC and NEXI, reviews the projects before the U.S. side recommends them. Japan can decline to fund all or part of a project. CSIS said that in that case Japan gives up distributions it would otherwise receive, and the US may raise tariffs on Japanese goods at a level set by the president. Investments under the program must be made before January 19, 2029, the end of Trump's second term. How the money flows The two sides described the money differently. US officials spoke of a direct cash commitment, while Japanese officials described a mix of direct loans, loan guarantees and credit support through state lenders. In July 2025, economic revitalization minister Ryosei Akazawa said Japan expected only about 1% to 2% of the $550 billion to be equity investment, the Japan Times reported. What happened next The first two rounds of projects were announced in February and March 2026, and JBIC began lending to them in May 2026; both rounds are covered in separate entries.
