February 1, 2019 marks a new era in commercial relations between Japan and the European Union with the implementation of the Economic Partnership Agreement signed by the representatives of the bloc and the Asian nation in July 2018.
This commercial pact, considered to be one of the most ambitious in the world, includes the elimination of a large part of the customs tariffs that were previously paid by European and Japanese companies. It also foresees the establishment of a trade zone that brings together 39.9 percent of global transactions and a third of the world’s Gross Domestic Product (GDP).
“Now that we are seeing protectionist movements in the world, this agreement is based on free and fair rules that generate benefits for the EU and for Japan,” said Takamori Yoshikawa, Japan’s Minister of Agriculture.
The EU foreign policy chief, Federica Mogherini, pointed out that both parties have much to celebrate as the “largest free trade zone in history” had come into force.
President of the European Commission, Jean-Claude Juncker, focused on the example that the agreement gives to the rest of the world. “Europe and Japan are sending a message to the world about the future of open and fair trade,” Juncker said.
The agreement represents an opportunity for the growth of many small and media sized companies said Frédéric Sánchez, president of the international section of the French employers’ association Medef.
“At present, even before the agreement, 80 percent of exports to Japan is from SMEs, he said”
“There is a culture of high quality products in Japan and we have companies in France that are able to manufacture products in niche markets that meet Japanese expectations of luxury, safety and protection, “said Sanchez.
According to the employer’s representative, Europe expects greater profits and growth in its agri-food industry, while Japan expects the same in its automotive industry.
“For cars, there is a 10 percent customs duty that will be eliminated in a period of 7 years. But what is much more important, are the auto parts that are taxed between 4 and 8% percent, which will be removed from day one, facilitating greater industrial cooperation in the automotive sector,” said Yoichi Suzuki, one of the members of the agreement negotiating team from Japan.