Japan and EU Reach 'Political Agreement' on Trade Deal
- Author: Rogelio Becker Jul 07, 2017,
Jul 07, 2017, 0:34
"Ahead of the G-20 summit tomorrow, I believe Japan and the European Union are demonstrating our strong political will to fly the flag for free trade against a shift toward protectionism", Japanese Prime Minister Shinzo Abe said at a news conference in Brussels, according to Reuters.
EU Council President Donald Tusk and Japanese Prime Minister Shinzo Abe will meet Thursday and shake hands on the landmark deal, which took four years to negotiate.
The agreement stands to eliminate tariffs on more than 90 percent of European Union exports to Japan when it goes into effect, ultimately saving European Union exporters some $1.1 billion in customs duties annually. Japan also intends to offer duty-free access for European soft and fresh cheese up to amounts equal to current trade levels, with the possibility for the import quotas to be increased, the official said on the condition of anonymity because the details of the draft accord have yet to be released.
Both sides aimed to conclude the negotiations before a summit of the Group of 20 advanced and emerging economies to be held Friday and Saturday in Germany, and emphasize the need to promote free trade.
The deal would slash European tariffs on Japanese cars and parts.
"Agri-food, which is Ireland's largest indigenous industry, will see particular benefits from the agreement, with new access for dairy products in particular beef and cheddar cheese industries", he said. A year ago it accounted for about $134 billion.
Until now, tariffs have also hindered vehicle exports by Japanese carmakers.
Teruyuki Daino, president of Kirin Holdings' wine business Mercian Corp, said he welcomed the potential expansion of the Japanese wine market, but added he was concerned over the impact on smaller Japanese wineries.
"Just like with CETA, this agreement sends a clear signal that the European Union is an ambitious negotiator that sets the bar high when it comes to worldwide trade", he said.
Canadian Prime Minister Justin Trudeau on Wednesday (28 June) called on Europe to immediately apply the CETA free trade agreement while the two sides work through a final hurdle pertaining to agricultural quotas.
The only remaining hurdle is investment protection, which was also controversial in the EU's trade negotiations with Canada. But the EU has had a hard time getting trade deals through national parliaments, with the EU-Canada deal nearly scuppered by Belgium's French-speaking regional parliament over fears it would lower EU health and safety standards and give corporations too much power.