At their 25th bilateral summit in Tokyo on Tuesday 17 July, the European Union and Japan signed their strategic partnership and economic partnership agreements concluded in 2017, thereby sending out a clear message against the protectionism and isolationism of Donald Trump's USA.
The signature of the EU/Japan economic partnership agreement - a free-trade agreement, the investment provisions of which will now be negotiated in the framework of a separate agreement (see EUROPE 12061) is an “historic step (…): the EU and Japan are sending a powerful message to promote free, fair and rules-based trade, and against protectionism”, European and Japanese leaders stress in their final statement.
This agreement “demonstrates to the world the firm political will of the EU and Japan to keep the flag of free trade waving high and powerfully advance free trade”, they stress, adding that it will be the “model of high-standard, free, open and fair trade and investment rules in the 21st century”.
“We are showing that we are stronger and better off when we work together and we are leading by example, showing that trade is about more than tariffs and barriers (…), and there cannot be unity where there is unilateralism”, the President of the European Commission, Jean-Claude Juncker, told the press after the summit.
The signature of this agreement shows the world Japan and the EU's unshakeable political will to champion free-trade and to lead the world in this direction, despite the spread of protectionism, stressed the Japanese Prime Minister, Shinzō Abe.
Political uncertainty, aggressive rhetoric, unpredictability and irresponsibility are the real risks to our businesses, not trade agreements, concluded the President of the European Council, Donald Tusk.
The EU and Japan hope to ratify their economic partnership agreement in the near future for implementation in early 2019. To do this, the agreement must be approved by the European Parliament and the National Diet of Japan.
The agreement aims to establish a free-trade zone covering nearly one third of global GDP and market of more than 600 million inhabitants.
It aims to increase by 24% exports of goods and services from the EU to Japan, currently standing at €58 and €28 billion per year respectively, Juncker stressed.
The European agri-food sector is likely to benefit hugely from this agreement, which will remove Japanese customs duty on dairy products (an extremely sensitive sector in Japan, which will nonetheless retain a transition period of 15 years) and on European wine, and will ensure the protection of 200 European geographical indications in the Archipelago.
As well as the protection on European territory of renowned geographical indications such as Kobe beef and Yubari melon, Japan will enjoy free access to the EU market for its automotive industry following a transition period - with the immediate elimination of customs duty of up to 4% on more than 90% of Japanese car parts and of all customs duty on cars over the next seven years, Juncker added.
The agreement also includes a chapter on sustainable development, which is based on the highest labour, security, environmental and consumer protection standards and includes - a first in any EU free-trade deals - a specific commitment concerning the international climate agreement concluded in Paris in 2015.
The Tokyo summit reaffirmed the EU and Japan's commitment in favour of the multilateral trading system, but also a modernisation of the World Trade Organisation, with a view to creating fairer rules. (Original version in French by Emmanuel Hagry)