Japan, EU sign free trade pact amid protectionism trend

Japan, EU sign free trade pact amid protectionism trend

"We are predictable - both Japan and [the] European Union - predictable and responsible and will come to the defense of a world order based on rules, freedom and transparency and common sense".

Japan's ambassador for worldwide economic affairs, Yoichi Suzuki, said earlier this year that if an EU-Japan deal were in force in the United Kingdom during the Brexit transition phase, it would buy Japan more time to establish a separate trade deal with Britain.

The entering into force of the agreement will bring into reality a massive free trade zone that accounts for about 30 percent of the world's gross domestic product, with a population of about 600 million.

"The EU and Japan showed an undeterred determination to lead the world as flag-bearers for free trade", Abe said at a joint news conference with European Council President Donald Tusk and European Commission President Jean-Claude Juncker.

Overall, European farmers will benefit, Juncker said, though European consumers will be able to more easily buy luscious Kobe beef and famous Yubari melons.

"The agreement demonstrates to the world - and to our citizens - that free, fair and rules-based trade remains an important tool to promote prosperity in our societies and globally".

Once in effect, . the deal will eliminate almost all of the tariffs levied on Japanese goods within the European market, . which means South Korean goods will no longer have the same price competitiveness within the market. Following the signing ceremony, they will seek parliamentary ratification.

Besides the latest deal with the EU, Japan is working on other trade agreements, including a far-reaching trans-Pacific deal.

The wide-ranging agreement is set to remove 99 per cent of the tariffs applied on EU exports to Japan, which amount to about €1 billion, in a boost to European food and drink producers, including wine and cheese makers, in particular.

Japan and the European Union signed a new free trade deal on Tuesday
Japan and the European Union signed a new free trade deal on Tuesday

Duties will be scrapped for cheeses as well as on wine.

It will abolish tariffs on Japanese cars and trucks in the eighth year and televisions in the sixth year following the implementation of the pact.

"Japan and the European Union will form a united front against a U.S. threat to impose tariffs on key products such as cars".

Brexit has also weighed on the minds of Tokyo trade negotiators.

Japan and the European Union had originally planned to sign the pact on July 11 in Brussels during Abe's planned overseas trip, but the prime minister canceled the plan to focus on dealing with the deadly torrential rain that hit western Japan.

But both parties have decided not to include a controversial scheme to settle investment disputes and will continue negotiations over the matter.

In a pointed message, Mr Tusk said: "The real risks to our economy, jobs and prosperity are political uncertainty, tariff war, unpredictability, irresponsibility and aggressive rhetoric".

Japanese vehicle and auto parts makers are also expected to increase their sales to Europe, where they have lagged behind European rivals.

The agreement was largely reached late a year ago.

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