Japan is stepping up efforts to expand trade and reinforce free trade links across global markets amid US tariff policies and growing uncertainty in international commerce. Tokyo is pursuing trade agreements and broader economic cooperation with partners in the Gulf, South America, India and Europe as it seeks to widen its economic diplomacy.

The world’s third-largest economy has become more active over the past decade in supporting a rules-based international trading system. Japan is negotiating a free trade agreement with the Gulf Cooperation Council and aims to become the second G7 country, after the United Kingdom, to conclude such a deal. It has also begun trade agreement discussions with Mercosur, the South American bloc of about 280 million people with a combined economy of roughly $3 trillion.

Japan imports agricultural products, energy, metals and mineral resources from Mercosur, while seeking future cooperation on rare minerals, lithium and clean energy. Bilateral trade with India reached about $23 billion in fiscal 2024-25, and cumulative Japanese investment there since 2000 exceeded $43 billion. Japan’s economic partnership agreement with the European Union has been in force since 2019.