STRASBOURG • European Union and Japanese plans to form the world's largest free trade area cleared their final hurdle yesterday when EU lawmakers backed a partnership set to enter into force early next year.
The European Parliament voted 474 in favour to 156 against the agreement that binds two economies accounting for about a third of global gross domestic product and also signals their rejection of protectionism.
Both face trade tensions with Washington and remain subject to United States tariffs imposed by President Donald Trump on imports of steel and aluminium, although the two have agreed to start separate trade talks with the US.
"This will bring clear benefits to our companies, farmers, service providers and others," said EU Trade Commissioner Cecilia Malmstrom in a statement.
"Our economic partnership with Japan - the biggest trade zone ever negotiated - is now very close to becoming a reality."
Japan had been part of the 12-nation Trans-Pacific Partnership that Mr Trump rejected on his first day in office, turning Tokyo's focus to other potential partners - such as the EU.
The EU has also sought other partners after the Transatlantic Trade and Investment Partnership negotiations with the US stalled in 2016. It concluded an updated trade deal with Mexico earlier this year.
The EU-Japan agreement will remove EU tariffs of 10 per cent on Japanese cars and 3 per cent for most car parts. It will scrap Japanese duties of about 30 per cent on EU cheese and 15 per cent on wines, as well as open access to public tenders in Japan.
It will also open up service markets, in particular financial services, telecommunications, e-commerce and transport.
The European Commission, which coordinates trade policy for the 28 EU members, said yesterday's vote paved the way for the agreement to enter into force on Feb 1. Japan's Parliament approved the deal last Saturday.
Covering more than 630 million people, the EU-Japan Economic Partnership Agreement (EPA) has been under discussion since 2013.
The pro-business lobby welcomed the deal.
"Approving the EU-Japan EPA, the European Parliament delivers on what business and citizens need in a time of political and economic uncertainty," said BusinessEurope director general Markus Beyrer.
"This agreement is projected to increase exports between the two economies by 34 per cent for the EU and 29 per cent for Japan, liberalising up to 99 per cent of bilateral trade," he argued.
REUTERS, AGENCE FRANCE-PRESSE