The Japan-EU Trade Agreement: Key Points and Implications
In July 2018, the European Union (EU) and Japan signed a historic trade agreement, known as the Japan-EU Economic Partnership Agreement (EPA). This deal was seen as a major breakthrough in international trade as it eliminated almost all tariffs on goods traded between the two markets, which account for more than a third of the world`s Gross Domestic Product (GDP). The Japan-EU trade agreement is, therefore, a significant development for businesses that operate within these regions. In this article, we will take a closer look at the key points and implications of the Japan-EU trade agreement.
Key Points of the Japan-EU Trade Agreement
The Japan-EU trade agreement covers a wide range of sectors, including agriculture, automobiles, and pharmaceuticals. Here are some of the key points of the agreement:
1. Tariff Cuts: The agreement provides for the elimination of tariffs on 97% of EU exports to Japan and 99% of Japanese exports to the EU. This means that businesses operating in these regions can sell their goods with fewer restrictions and at lower costs, which should boost trade and profits for many companies.
2. Intellectual Property Protection: The deal strengthens intellectual property protection for companies operating in both regions, including patents, trademarks, and geographical indications.
3. Public Procurement: The agreement opens up government procurement opportunities for businesses in both regions, which will allow them to bid for public contracts in Japan and the EU.
4. Regulatory Cooperation: The agreement encourages regulatory cooperation between the two markets, which will promote the development of compatible regulations and standards. This will make it easier for businesses to operate in both markets without having to deal with different sets of regulations.
Implications of the Japan-EU Trade Agreement
The Japan-EU trade agreement is expected to have far-reaching implications for businesses in both regions. Here are some of the key implications of the deal:
1. Increased Trade: The elimination of tariffs and other trade barriers is expected to increase trade between Japan and the EU significantly. This will benefit businesses in both regions, especially those that rely on exporting goods to the other market.
2. New Market Opportunities: The agreement opens up new market opportunities for businesses in both regions, especially in sectors such as automotive, agriculture, and pharmaceuticals. The removal of trade barriers means that businesses can expand their operations and take advantage of new market opportunities.
3. Competitive Pressure: The trade deal is likely to create more competition for businesses in both markets. This means that companies will need to be more innovative, efficient, and productive to remain competitive.
4. Regulatory Cooperation: The agreement will promote regulatory cooperation, which will benefit businesses that operate in both regions. This will reduce the regulatory burden on these companies and make it easier for them to comply with regulations in both markets.
Conclusion
The Japan-EU trade agreement is a significant development for businesses operating in Japan and the EU. The elimination of tariffs and other trade barriers is expected to increase trade and create new market opportunities for companies in both regions. However, the deal also creates more competition, which means that businesses will need to be more innovative, efficient, and productive to remain competitive. Overall, the agreement should benefit businesses in both regions, as well as consumers who will have access to a wider range of goods at lower prices.
