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Blog: Strengthening ties to Japan in uncertain times

Met dank overgenomen van A.C. (Cecilia) Malmström, gepubliceerd op dinsdag 11 april 2017.

The 18th round of negotiations on a trade agreement between the EU and Japan took place in Tokyo last week. This was the first round of talks since the leaders' meeting in March between President Juncker, President Tusk and Prime Minister Abe, where they all affirmed our commitment to conclude these negotiations as early as possible this year. At the round last week, all issues to be covered by the agreement were discussed, working towards narrowing the remaining gaps between us.

We will shortly publish a more detailed report about the round and the state of play of each topic.

As the EU's trade negotiations with Canada and the US have grabbed the headlines over the past few years, it has been easy to overlook the fact that the European trade agenda is much wider - extending also to Japan, the world's fourth largest economy and our closest partner in Asia. It was in 2013 that all Member States of the EU instructed the European Commission to start talks for a trade deal with Japan, in order to make it easier for European exporters to sell their products and services to a strong market of almost 130 million people.

The EU and Japan already have close trade ties. The EU exports over €80bn of goods and services to Japan every year. More than 600,000 jobs in the EU are linked to exports to Japan, with Japanese companies alone employing more than half a million people.

However, European firms still face a wide range of barriers to trade. One is customs tariffs, particularly on food imports into Japan. Duties on many European products, such as pasta, chocolate and wine are quite high; the same goes for European shoes, leather products and many other goods. This hampers access to the Japanese market and makes them too costly for many Japanese consumers. A trade deal could greatly improve such access and see over €1 billion a year in tariffs removed at the stroke of a pen.

Yet another barrier is Japanese technical requirements, which often make it more difficult to export safe European products to Japan. An agreement would go a long way in ensuring that such rules are more transparent and fair for our exporters. The best way to secure such a level playing field is by ensuring that requirements are in line with international standards. Already, our negotiations have born valuable fruit, as the EU and Japan have intensified their cooperation in several international standard-setting fora, for instance on motor vehicles. In parallel, we want to focus on helping smaller exporters who are disproportionately affected even by smaller barriers. That's why we want to have a dedicated chapter for them in the agreement.

We are also aiming to create new opportunities for European services firms and investors in areas like maritime and financial services or digital trade, and bring big opportunities on the Japanese government procurement market.

There is an ongoing vibrant public debate on trade and globalization, and we are now applying the lessons learnt from this debate in our negotiations with Japan. The EU-Japan agreement will contain all of the guarantees built into the EU-Canada trade agreement - safeguarding the right to regulate, strong rules on labour rights and the environment, and guarantees that public services can remain public. We have also proposed that Japan follow our new, transparent model of investment dispute resolution, known as the Investment Court System.

The negotiation process is conducted under the strict scrutiny of EU Member States and the European Parliament. Since January 2016 alone, there have been 13 meetings with all EU Member States and ten with the European Parliament's trade committee - in addition, the European Parliament has set up a dedicated monitoring group for the negotiations. We have consulted extensively with stakeholders, civil society in particular. We have published our most recent negotiating proposals and reports of negotiating rounds, and published a comprehensive assessment of the impact of a possible agreement.

Economic forecasts suggest that over the next decade around 90% of the world's economic growth will take place outside Europe, much of it in Asia. So we need to act now, to make sure EU businesses, workers and farmers can fully benefit from those growing opportunities. However, apart from the direct economic benefits of a trade deal, there is a bigger picture to take into account. With Japan, the EU shares a commitment to the international rules-based trading system, and we have much in common than trade: a commitment to democracy and the rule of law, environmental protection, and high labour, environmental and consumer protection standards. Strengthening the partnership with our closest Asian ally, building bridges between us, is now needed more than ever as we face rising protectionism around the world. An EU-Japan trade deal would send a powerful signal.


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