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Currency, United States Finance

EU and Japan strike free trade deal

Japan and the European Union have formally agreed an outline free trade deal which will ease the movement of goods between two of the world’s largest economies.

The pact, though still requiring some further negotiation, is scheduled to come into effect in early-2019 and will guarantee tariff-free trade between businesses within the two regions.

Japanese Prime Minister Shinzo Abe met with European Council President Donald Tusk and European Commission President Jean-Claude Juncker in Brussels, Belgium, Thursday to sign the deal.

It is expected that the deal will liberalize 99 percent of trade between Japan and the EU, benefiting Japan’s autos industry and the EU’s farming sector in particular, according to BBC reports.

It will also see the regions co-operate on other issues, including climate change and terrorism.

Plans for a deal had been underway for four years but were stalled by varied demands from either side. However, talks gained a new urgency amid growing protectionist policies to emerge from the U.S. and Thursday’s agreement will send a clear message to other global leaders ahead of this weekend’s G20 summit.

The International Monetary Fund on Wednesday urged leaders of the Group of 20 major economies to avoid “myopic” nationalistic policies and to work together in agreed forums to resolve their trade and economic differences.

“We did it,” Tusk announced following the signing Thursday morning.

“We concluded EU-Japan political and trade talks. EU is more and more engaged globally.”

President Abe added that the pact provided a “win-win” for both parties and said he hoped it would encourage the early enactment of the Trans-Pacific Partnership agreement between Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and the U.S.

Source: cnbc
EU and Japan strike free trade deal

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