EU and Japan – agreement on free trade deal
The EU and Japan have reached an agreement in principle on both an Economic Partnership Agreement and a political Strategic Partnership Agreement, which both regions say represents an ‘economic landmark’. “Two of the world’s largest economies have agreed to conclude a free trade agreement at a time when protectionist winds are blowing around the world. This sends an important signal to the rest of the world,” says Minister for EU Affairs and Trade Ann Linde.
Two thirds of the Swedish companies currently exporting to Japan are small, and the Japanese market is particularly important for counties such as Uppsala, Dalarna, Västernorrland, Stockholm and Jämtland. "This is extremely positive," says Ms Linde, who believes the agreement will boost trade for both small and large companies.
"There is a lot of Swedish technology of interest to Japan, not least in the fields of health and climate change. Smart cities and sustainable transport are two examples; waste management is another," says Ms Linde.
Japan will abandon customs duties on 97 per cent of all goods once the agreement is implemented, making it the most ambitious agreement the country has ever reached. The EU will abandon 99 per cent of its customs duties. The agreement also contains simpler regulations facilitating trade.
Japan has previously had its own very distinct regulations in the automotive sector. From 2019 onwards, Japan will follow international UN regulations. "This is good news for Swedish car manufacturers," says Ms Linde.
The agreement was preceded by four years of negotiations. Besides duties, it contains provisions on market access for both goods and services, and public procurement.
It also contains proposals for deeper cooperation in a number of other areas, including intellectual property law, competition, sustainability, and animal and plant health, and this will be the first time an agreement includes a specific commitment on the effective implementation of the Paris Agreement.
It is important to note that some details in the agreement still need to be ironed out. Negotiations on investment protection, regulatory cooperation and some technical issues have not yet been completed and are expected to continue in the autumn. The hope is that all remaining issues will be resolved before the end of the year. This will be followed by a process in the European Council and Parliament to conclude and sign the agreement.