In World Economy News 03/07/2017
Japan and the European Union are on the cusp of a wide-ranging free trade agreement that could help blunt the forces of protectionism sparked by U.S. President Donald Trump’s trade policies.
EU Trade Commissioner Cecilia Malmstrom said she was “quite confident” that a broad agreement can be announced at a summit on July 6 with Japanese Prime Minister Shinzo Abe as both sides finalise the reduction of tariffs on autos and agricultural goods.
Clinching a deal would offer Japan and Europe an important political victory and could raise questions about the U.S. government’s influence on the agenda for the global economy.
“You can do good, fair, transparent and sustainable trade agreements where you win and I win, and not the American view, which seems to be, ‘You lose and I win,'” Malmstrom told reporters.
Malmstrom spoke after two days of meetings with Japanese Foreign Minister Fumio Kishida in Tokyo about a deal that would eliminate a broad range of trade barriers.
European officials have been pushing for a reduction in Japanese tariffs on cheese and agriculture imports that are as high as 30 percent in return for phasing out tariffs on Japanese autos and auto parts.
This tradeoff initially met strong resistance, because some politicians want to protect Japan’s dwindling dairy industry. However, Malmstrom expressed confidence that both sides have overcome this problem and can reach a deal.
“We’ve made meaningful progress, but there are still important points remaining,” Kishida told reporters.
“Since we are trying to reach a broad agreement in time for the summit, I am planning to travel to Brussels to make this happen.”
Kishida added that his visit would occur before Abe’s participation in a Group of 20 summit in Hamburg on July 7-8.
Japan and the EU have been negotiating a trade deal since 2013. The talks have taken on a greater sense of urgency since Trump walked away the Trans-Pacific Partnership (TPP), leaving the other 11 members of the Pacific Rim trading bloc, including Japan, in limbo.
Source: Reuters (Reporting by Stanley White and Kaori Kaneko; editing by Jason Neely)
