EU-Japan agreement, analysis of economic partnership pact
On 8.12.17, European Trade Commissioner Cecilia Malmström and Japanese Foreign Minister the Taro Kono announced the establishment of an economic partnership agreement between the European Union and
Japan
. Pending details, an initial analysis. (1)
The EU-Japan Economic Partnership Agreement (EPA) complements a strategic understanding-the Strategic Partnership Agreement-which instead covers political cooperation, security, climate change and, more broadly, joint development policies.
The goal of the EPA is to establish a free-market-inspired economic policy through progressive reduction of respective import duties and especially technical barriers to trade between the European Union and Japan. The agreement is expected to affect a quarter of global GDP, roughly (US$26,000 billion), and come into effect in 2019. Following signatures and ratifications, expected by next summer.
The reduction in customs duties will affect many categories of European products heading to the Rising Sun. In all, 85 percent of tariffs on European agri-food products-which account for 87 percent of exports to Japan-will be admitted, progressively, to a duty-free regime. On the opposite side, Made-in-Japan motor vehicles, machinery and electronics will benefit from progressive opening in Europe. (1)
European wines will be the first to benefit from the agreement, thanks to the immediate elimination of duties that to date are among the most afflictive in the world. 31% sparkling wines, 15% other bottled wines, 19.3% bulk wines. Japan is the fifth largest export market for European and Italian wines. For more than 750 million euros annually, including 165 from Italy (2016 data).
Pork is also expected to undergo a drastic reduction in import gabs, while beef will witness their gradual easing-from the current 35 percent, toward 9 percent-over a longer time horizon. 15 years, the same as those provided for the complete elimination of duties-now at 30 percent-on hard cheeses. For fresh cheeses, however, the share of exports to Japan will have to be negotiated on a case-by-case basis.
European and Italian beer can finally fall under the appropriate customs code, instead of the ‘alcoholic soft drink‘ code, as early as 2018. In the ten years to follow, the designations of liquors and spirits will be harmonized. Rice, on the other hand, is totally excluded rtdrom the agreement.
The protection of PDOs and PGIs registered in the EU in Japan will be limited to 205 foods, 40 of which are Italian, and more numerous wines, 130 from Italy. Nothing new on the eastern front, after the sell-off of our geographical indications, from Brussels to the American continent.
Non-tariff measures and barriers to imports were also considered in a separate chapter of the agreement, ‘Good Regulatory Practices and Regulatory Cooperation. The first barrier is on closer inspection the linguistic one, considering that almost all of Tokyo’s laws are available only in ideograms.
l only ‘encouragement’ to provide guidelines in English is therefore worthless, given the technical barriers encountered in exporting food products to Japan. Although a small step forward is represented by other chapter of the agreement, devoted to ‘
Food additives’
.
They remain Finally inconclusive, to date, negotiations on ‘Investment protection standards‘ e ‘Investment dispute resolution‘. Good news for those who, like the writer, consider it dangerous to put the interests of the
Corporation
to those of citizens.
Dario Dongo
Notes
(1) The Annex to the agreement where the details on duties and and categories of products affected are defined has not yet been made public. Confirming, if any were needed, the lack of governance of the European Executive
Dario Dongo, lawyer and journalist, PhD in international food law, founder of WIISE (FARE - GIFT - Food Times) and Égalité.
