Commission green-lights opening of FTA talks with Tokyo
By Joanna Sopinska | Wednesday 18 July 2012
Despite internal squabbles, the European Commission adopted, on 18 July, a draft mandate for opening free trade negotiations with Japan. Trade Commissioner Karel De Gucht, who announced the decision following a 90-minute delay, warned Tokyo that if during the first year of talks it does not make “satisfactory” progress in dismantling the non-tariff barriers, the Commission would leave the negotiating table.
“I have made it very clear to my colleagues today that after one year of starting the negotiations, we will take stock on the progress Japan has made on dismantling the non-tariff barriers as set out in the road map we have agreed together. If the implementation has not been satisfactory, I will stop the negotiations,” said De Gucht. This condition was expected to appease Enterprise and Industry Commissioner Antonio Tajani, who was firmly against launching talks with Japan over its poor progress in lifting the current regulatory barriers to trade, in particular in the automobile sector (see
Europolitics4458). Tajani fears that additional “unfair” competition from Japanese car companies might affect European producers, prompting large-scale job cuts. Commenting on Twitter on the College of Commissioners’ 18 July decision, Tajani pledged to “firmly defend” the EU automobile sector’s interests during the talks with Japan.
Meanwhile, in a statement issued the same day, the European Automobile Manufacturers’ Association (ACEA) reiterated that it remains “sceptical about the benefits of a future EU-Japan free trade agreement for the EU automobile sector”. “The FTA risks being used by the Japanese as a tool for passing on productive capacity that cannot be absorbed at home to the EU, a market which increasingly has its own issues of overcapacity,” it argued.
De Gucht pledged to address the car producers’ concerns, but underlined at the same time that there are other industry associations (in the agri-food and drink, pharma and chemicals sectors) that had declared their “strong support” for FTA talks with Japan. He called on all producers to increase their competitiveness rather than try to lobby against free trade agreements. “It is up to EU producers to make sure that there is a demand for what they produce,” De Gucht told a press conference.
He made it clear that the EU would not reduce tariffs before Japan “delivers concrete results on regulatory barriers”. “This includes the car sector,” De Gucht added.
According to the Commission, opening up the Japanese market could increase the EU’s GDP by almost another percentage point and boost EU exports to Japan by one third. “Four hundred thousand additional jobs are expected as a result of this deal - in the EU alone,” said the EU executive in a statement.
The draft negotiating mandate will be now forwarded to the Council, which is expected to rubber-stamp it at the European Council meeting in October. The first round of talks could start early next year, following the EU-Japan summit, which is expected to take place in the autumn in Tokyo (no date yet). According to diplomatic sources, there is “enough” support in the Council for the mandate to be adopted in October.