It was the trade deal that seemed to come together overnight. So much so, that even Japan was taken off guard by the speed of President Donald Trump’s declaration at a press briefing with Japanese Prime Minister Shinzo Abe at the Group of Seven meetings last month that the nations had struck a trade pact.

The leaders agreed to the broad strokes of a limited trade deal covering agriculture, industrial tariffs and digital trade, but left plenty of loose ends that need to be tied up to achieve Trump’s goal of signing the final deal later this month at the United Nations General Assembly.

To recap what’s at stake: Trump has threatened additional duties of as high as 25% tariffs on cars imported from Japan (and the EU) failing a broader agreement to narrow the U.S. trade deficit. As it stands, the duties on Japanese vehicle imports to the U.S. are now set at 2.5% (and 25% for trucks).

In this final push, what kind of leverage does Japan have?

  • The country leapfrogged China to become the largest foreign creditor to the U.S. in June — a position it last held in 2017, according to the latest data published by the Treasury department. The trade war with China has at times stoked speculation that Beijing could weaponize its more than $1 trillion Treasury holdings in retaliation. However unlikely that may seem at the moment, the same concerns could be raised for Japan.
  • Japan is the U.S.’s third-largest trading partner, and it’s the fourth-largest export market, including for a large chunk of agricultural goods. Japan could find it a politically astute move to retaliate against any U.S. car tariffs in the Farm Belt — a key support base for Trump. That’s what China has done, and it’s left American farmers reeling.
  • And overall, Japan could keep dragging this out and and let the economic pressure on Trump build ahead of his 2020 re-election bid. As the anecdotes from latest U.S. central bank’s “Beige Book” report from business contacts across the country shows, the tariffs and trade policy uncertainty remain a persistent worry for businesses and it’s upended supply chains.