The EU and Japan Just Signed a Monumental Free-Trade Deal
The European Union and Japan signed a monumental trade deal Tuesday, eliminating nearly all tariffs between the entities in one of the world’s largest free-trade deals. The pact, signed in Tokyo, covers a third of the global economy, the Associated Press reports.
The agreement is in stark contrast to President Donald Trump’s trade war and alignment with Russian President Vladimir Putin on Monday. Although the leaders didn’t mention him by name, Japanese Prime Minister Shinzo Abe and EU leaders Donald Tusk and Jean-Claude Juncker distanced themselves from Trump’s tactics in a press conference following the deal.
“Politically, it’s a light in the increasing darkness of international politics,” European Council President Tusk said of the deal, according to The Guardian. “We are sending a clear message that you can count on us. We are predictable – both Japan and [the] EU – predictable and responsible and will come to the defense of a world order based on rules, freedom and transparency and common sense.”
“Let me say that today is a good day not only for all the Japanese and Europeans but for all reasonable people of this world who believe in mutual respect and cooperation,” he continued. “We are putting in place the largest bilateral trade deal ever. This is an act of enormous strategic importance for the rules-based international order, at a time when some are questioning this order.”
Tusk also ensured the EU’s and Japan’s joint support of the Iran Nuclear Deal, which Trump pulled out from earlier this year. The partnership between the EU and Japan is also being strengthened in other areas, the AP reports, such as climate change, defense, and anti-protectionism.
The deal was established primarily last year, but the signing was delayed due to disastrous flooding in Japan that left more than 200 dead. Now signed, the pact requires legislative approval. Once passed, the AP reports Japan will see lower prices on European wines, cheese, pork, handbags, and pharmaceuticals while the EU will see lower price tags on Japanese machinery parts, tea, and fish. Eventually, about 99% of tariffs on all imports will be eliminated.
According to The Guardian, Abe said the deal “shows the world the unshaken political will of Japan and the EU to lead the world as the champions of free trade at a time when protectionism has spread.”
The deal with Japan is just one of many the EU has in negotiations to improve trade relations, the New York Times reports. It signed a free-trade pact with Canada last year, is working to update a pact with Mexico this year, and is currently finalizing deals with Vietnam and Singapore.
The European Commission announced that Juncker, its president, will visit Washington next week to discuss economic opportunities with Trump.