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European Parliament approves JEFTA

Stop to major part of the duties on EU goods exported to Japan

The EP communicates today the approval of JEFTA, the free trade agreement between EU and Japan. According to this agreement the Parliament considers that wine, spirits, meat, dairy, textile, leather traders, rail procurement, SMEs will be the main winners

The European Parliament gave today, on Wednesday December 12, its consent to the EU’s trade agreement with Japan, the largest bilateral trade deal ever negotiated by the EU. The Economic Partnership Agreement between the EU and Japan, approved with 474 votes to 152 with 40 abstentions, will remove almost all custom duties adding up to €1 billion annually for EU companies. It represents a clear stance in support of rules-based, free and fair trade “at a time of serious protectionist challenges”.

Agriculture, SMEs win

While the most sensitive EU sectors such as rice production are safeguarded, wine, cheese, beef, pork, pasta, chocolate and biscuits will enter duty-free either immediately or after a transition period, 205 products with European geographical indications will be protected, to help small and medium sized enterprises (SMEs) which make up 78 percent of exporters to Japan. Parliament urges the Commission to set up contact points for them, so that they can quickly benefit from the agreement.

Railways, services

Japan opens up its rail procurement market and public procurement in its main cities to European competition. E-commerce, international maritime transport and postal services will also be liberalised.

Labour codes

The Parliament welcomed the high level of environmental and labour protection, the commitment to the Paris Agreement to combat climate change, and encourages both parties to combat illegal logging. MEPs nevertheless stressed that Japan must ratify all relevant labour codes set by the International Labour Organisation.

Parliament also approved today the Strategic Partnership Agreement with 535 votes for, 84 against and 45 abstentions, which extends cooperation to areas such as energy, education, research and development, development, and the fight against climate change and terrorism.

“Today’s approval is a key milestone for fair trade based on rules and values, amid rising protectionism. The agreement will help promote high standards and strengthen sustainable development in trade policy. The European Parliament is sending a very progressive message and will continue to do its part, so that the biggest EU bilateral trade agreement truly works for both citizens and businesses", said Pedro Silva Pereira (S&D, PT), the rapporteur in charge of the trade agreement.

“The European Parliament's answers to the challenges of globalisation are cooperation and global standard setting. We firmly reject inward-looking protectionism and nationalist tendencies – they will not solve the pressing problems we are facing, but only drive us further apart. It will be crucial to swiftly implement the accord and involve civil society at every step to ensure that the agreement benefit workers and citizens", said Bernd Lange (S&D, DE), the chair of the trade committee.

Next steps

Japan has already ratified the agreement. After the endorsement of the trade deal by the European Parliament, Council is set to give its final go-ahead on 21 December which allows the agreement to enter into force on 1 February 2019. For the strategic partnership agreement to enter into force, all member states have to ratify it.

The EU-Japan Economic Partnership Agreement, signed on 17 July 2018, creates a trade zone of 600 million people, and covers a third of global GDP and about 40 percent of global trade. Negotiations on a separate investment protection agreement with Japan are ongoing.

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