(VOVWORLD) - European and Japanese leaders have signed a free trade agreement after 4 years of negotiation. Along with economic benefits, the deal reflects a political will and determination by both sides to reject Donald Trump’s protectionist posture against multi-national trade agreements.
 European Council President Donald Tusk and Japanese Prime Minister Shinzo Abe (Photo: AFP) |
The free trade agreement between the EU and Japan was signed last Thursday, just a few days before the G20 Summit in Germany. European Council President Donald Tusk, European Commission President Jean-Claude Juncker, and Japanese Prime Minister Shinzo Abe were involved in the agreement.
The trade pact covers an area with a population of 600 million people which accounts for 30% of the global economy and 40% of global trade.
Prime Minister Abe said the new deal will likely be an inspiration for future multilateral trade agreements. The EU called it a fair, free, and ambitious trade pact.
The EU says that even though the US is turning inward, the rest of the world can still integrate. The EU cooperating with Japan months after signing a similar deal with Canada shows that cooperation is still a real trend.
Under the EU-Japan free trade agreement, the EU will open its market to Japan’s world-leading automobile manufacturing sector. In return, Tokyo will remove barriers for farm produce imported from EU members. Import tariffs imposed on EU products like cheese, spaghetti, meat, and wine will be cut.
Japan says the agreement the EU and Japan reached last Thursday is consistent with the main elements of the EU-Japan Economic Partnership Agreement.
According to both EU and Japan, the deal may cause some problems for US firms who will have to compete with European companies when they export to the Japanese market.
The US had opportunities to access the Japanese market, the world’s third largest, via the Trans-Pacific Partnership Agreement. But President Donald Trump withdrew from that deal soon after he was sworn in. The US showed an interest in negotiating a bilateral trade agreement with Japan, and the US and Japan held a couple of discussions in April, but the issue was eclipsed by the possibility of the US re-negotiating the North American Free Trade Agreement with Mexico and Canada this year.
The EU-Japan Trade Agreement is expected to be ratified by the end of this year.