EU and Japan to hold Brussels summit on huge free trade deal

BRUSSELS • The European Union (EU) and Japan will hold a summit tomorrow in hopes of sealing broad agreement on a huge trade deal after four years of tough negotiations.

The landmark deal would mark a big victory for free trade just days before a Group of 20 (G-20) summit in Germany, where US President Donald Trump is expected to defend his "America First" stance.

The hastily planned Brussels meeting follows weeks of intense negotiations in Tokyo and will be attended by European Council President Donald Tusk, EU Commission chief Jean-Claude Juncker and Japanese Prime Minister Shinzo Abe.

The combined EU and Japanese economies account for a colossal 28 per cent of global output.

"EU-Japan Summit on Thursday. Ambitious free and fair trade deal in the making," Mr Tusk tweeted yesterday. A separate statement said: "At the summit, leaders are expected to announce a political agreement on the EU-Japan free trade agreement and the EU-Japan strategic partnership agreement."

At this stage, the EU and Japan are expected to reach only a "political agreement" on the trade deal that would still cover some of the accord's toughest aspects. A complete deal would be formally signed later this year, according to EU plans.

Mr Abe said in Tokyo that the deal was not done and sent Japan's Foreign Minister Fumio Kishida to Brussels for talks today to iron out final differences.

"While staying mindful of the sensitive areas for both sides, I will do everything until the final moment to achieve the best outcome for our national interest," Mr Kishida said.

At the heart of the accord is an agreement for the EU to open its market to the world-leading Japanese auto industry, with Tokyo in return scrapping barriers to EU farming products. Left untouched would be the controversial investment courts that have stoked opposition to trade deals in the EU nations, including Germany and France.

The deal could be seen as a provocation to Mr Trump, who pulled the US out of the 12-nation Trans-Pacific Partnership this year, in favour of striking country-to-country bilateral deals.

EU Trade Commissioner Cecilia Malmstroem and Agriculture Commissioner Phil Hogan visited Tokyo last week for urgent talks with Japanese officials, where Ms Malmstroem said the package would "tear down almost all customs duties between us that are worth a lot of money, billions actually".

EU exports to Japan overall "could be boosted by one third" and a deal would send a "strong signal to the rest of the world that the EU and Japan believe in free trade", she said.


A version of this article appeared in the print edition of The Straits Times on July 05, 2017, with the headline 'EU and Japan to hold Brussels summit on huge free trade deal'. Print Edition | Subscribe