Japan Brussels 29 November 2012
EU-Japan Free Trade Agreement: Commissioner De Gucht welcomes Member States’ green light to start negotiations
Remarks by EU Trade Commissioner Karel De Gucht following the Foreign Affairs Council (Trade)
“I am delighted that the Council has today decided to give the Commission 'the green light' to start trade negotiations with Japan. We now have a clear mandate – confirmed by all the Member States - which sets out Europe's objectives.
Just to give you several examples:
- The mandate sets out a strict and clear parallelism between the elimination of our duties and non-Tariff Barriers in Japan. 'Like for like' if you will.
- There's a safeguard clause to protect sensitive European sectors.
- We explicitly reserve ourselves the right 'to pull the plug' on the negotiations after one year if Japan does not live up to its commitments on removing non-tariff barriers.
Furthermore, in the last few months, we tested just how serious our Japanese partners were about opening up their market. I am happy to tell you that we got results – including the removal of a number of key non-tariff barriers up front – such as granting liquor licenses to European operators.
Such moves have given us all the reassurance we could reasonably expect before a formal negotiation is opened. And no other partner has ever gone as far as Japan before we sat down at the negotiation table together.
So, let us not be anxious. Europe is not naïve. Europe is going into these negotiations with our 'eyes wide open'.
This is an important political decision - and necessary - if we want to foster growth and jobs in Europe. Forecasts for the successful conclusion of an ambitious free trade agreement with Japan show it could deliver around 0.8% of GDP growth for the EU and more than 400,000 jobs. That's exactly what our economies need. And we will do it by ensuring we open up the Japanese market and by ensuring we give European business real opportunities in Japan.”
Potential benefits of EU-Japan Free Trade Agreement (FTA)
- A free trade deal with Japan would boost Europe's economy by 0.8% of its GDP
- EU exports to Japan could increase by 32.7%, while Japanese exports to the EU would increase by 23.5%
- 420,000 additional jobs in the EU are expected as a result of this agreement
What’s in the negotiating mandate that the Member States adopted today?
Given the importance that the elimination of non-tariff barriers has for realising the level playing field for European businesses on the Japanese market, the negotiating directives foresee that:
- Japanese non-tariff barriers will have to be eliminated in parallel to any tariff reductions on the EU side.
- The European Commission should suspend negotiations if progress as specified in the non-tariff barriers and railways and urban transport roadmaps does not materialise within one year from the start of the negotiations.
- There is a safeguard clause to protect sensitive European sectors.
What has happened so far
At the EU-Japan Summit of May 2011, the EU and Japan decided to start preparations for both an FTA and a political framework agreement and stated that on the basis of a successful scoping exercise, the Commission would seek the necessary authorisation from the Council for negotiations.
After one year of intensive discussions, in May 2012, the Commission has agreed with Japan on a very ambitious agenda for the future negotiations covering all EU market access priorities. The Commission has also agreed with Japan on specific 'roadmaps' for the removal, in the context of the negotiations, of non-tariff barriers as well as on the opening up of public procurement for Japan's railways and urban transport market.
On 18 July 2012, the European Commission asked the EU Member States for their agreement on opening negotiations for a Free Trade Agreement with Japan.
EU-Japan: Trade flows
Japan is the EU’s second biggest trading partner in Asia, after China. In 2011 EU exports had reached a value of €49 billion, mainly in the sectors of machinery and transport equipment, chemical products and agricultural products. In 2011 EU imports from Japan accounted for €67.5 billion. In 2010, EU imports and exports of commercial services from and to Japan were €12.7 and €17.2 billion.
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