EU and Japan sign Economic Partnership Agreement

18 Jul '18
2 min read
Moments of EPA signing in Tokyo. Courtesy: Twitter handle of Jean-Claude Juncker
Moments of EPA signing in Tokyo. Courtesy: Twitter handle of Jean-Claude Juncker

European Union and Japan have signed an Economic Partnership Agreement (EPA) creating an open trade zone covering over 600 million people. The landmark deal eliminates about 99 per cent of the tariffs on Japanese goods sold to the EU. About 94 percent of the tariffs on European exports to Japan will be lifted, rising to 99 per cent in the future.
 
The EPA—the biggest ever trade agreement negotiated by the EU—will remove the vast majority of the €1 billion of duties paid annually by EU companies exporting to Japan. It will also open up the Japanese market of 127 million consumers to key EU agricultural exports and will increase EU export opportunities in a range of other sectors, including textiles and clothing.
 
As per the EPA, Japan will eliminate tariffs on 94 per cent of imported goods from the EU, including 82 per cent of farm and fishery products. It will immediately cut tariffs on chemical, industrial and textile products, and set up a low-tariff quota on soft cheese from the EU. However, it will exclude rice from lower tariffs.
 
On the other hand, the EU will cut tariffs on 99 per cent of imports from Japan. It will immediately scrap tariffs on more than 90 per cent of auto parts in terms of trade value, and will eliminate the remaining 10 per cent tariff on Japanese automobiles seven years after the deal’s implementation.
 
The EPA will also in addition strengthen cooperation between Europe and Japan in a range of areas, reaffirm their shared commitment to sustainable development, and include for the first time a specific commitment to the Paris climate agreement.
 
The pact has been signed at a crucial time when the US administration is increasing tariffs on imports from several of its trading partners. “The EU and Japan showed an undeterred determination to lead the world as flag-bearers for free trade,” Japanese Prime Minister Shinzo Abe said at a joint news conference with European Council President Donald Tusk and European Commission President Jean-Claude Juncker.
 
The agreement now needs to be ratified by the European Parliament and the Japanese Diet following which it could enter into force in 2019. (RKS)
 

Fibre2Fashion News Desk – India

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