Japan and the EU want to sign off on JEFTA by July – is that wishful thinking?

The EU-Japan deal is intended to send a pro-free trade message to Donald Trump


Japanese and European negotiators of the free trade agreement between the EU and Japan — (known as JEFTA) are pushing to agree the free trade deal by the end of July. If agreed JEFTA — which has been negotiated in secret over a number of years — will prove to be EU’s biggest free trade deal yet.

Sources said the goal is for Japanese Prime Minister Shinzō Abe to attend a Brussels summit ahead of a G20 summit in Hamburg to secure a ‘political deal’ covering more than 90 percent of the trade agreement, leaving a handful of issues to be resolved later.

European Trade Commissioner Cecilia Malmström is looking to cast the EU as the ‘new global leader’ on free trade, and a deal with Japan would issue a warning to Donald Trump’s domestic and protectionist agenda. Malmström has said the deal with Japan is her “main priority in the short term.”

Japan is the EU’s sixth-biggest trading partner, and the two parties do around €125 billion of trade a year. The EU and Japan represent nearly 30 percent of global gross domestic product.

Although no dates are set in stone a European Commission spokesperson, said that ‘leaders are committed to reaching a political agreement as soon as possible. The next time they meet will be in connection with the G20.’

One of Japan’s biggest problems with the deal has been fear of a push back from Japan’s agricultural sector fearful of EU agricultural exporters. Tokyo’s parliament has since passed a package of reforms to boost Japanese farmers, in an effort to address fears of a the deal.

Japan’s number one priority has been to break down the EU’s ten per cent tariff on automotives manufactured in Japan.

It is also unlikely that Japan will accept the Investment Court System (ISDS) — the secret courts system set up by the EU to solve investor-state disputes in the short term. The employment rights/labour clauses in the JEFTA deal are also considered weak by trade unions, and other commentators have said that JEFTA ‘shows all the bad traits of TTIP (the EU-US deal currently on ice) and CETA (the EU-Canada deal which has been ratified).’

Some EU diplomats, are also skeptical over whether a political agreement will allow Brussels and Tokyo to implement the final by July. ‘Remember the EU-Canada deal — after we reached a political agreement, it still took more than a year to finish the trade deal,’ one EU negotiator has said.

Meanwhile, a former New Zealand trade negotiator has been appointed as the UK Government’s top man for finding trade deals with countries outside the EU.

Crawford Falconer, who has previously described Brexit as a ‘enormous opportunity’, is a former vice minister for international trade and foreign affairs and ambassador to the World Trade Organisation, he is currently a trade professor at Lincoln University.

In his role as ‘chief trade negotiation adviser’ and second permanent secretary at the Department for International Trade (DIT), Falconer will be responsible for boosting ‘negotiating skills’ in the DIT and seeking out market access deals with countries outside the EU. It is reported that currently 3,000 people now work for the DIT.

Parroting the mantra of Brexiteers, Falconer said Brexit was a ‘potential game changer’ with countries  like Australia, New Zealand and Mexico looking to work with the UK. He went onto say:

“As the UK prepares to leave the EU, it will be top of the Government’s agenda to turn the enormous new opportunities opening up for the UK into win-win agreements with our trading partners around the globe. As the world’s fifth largest economic power, the UK will bring much needed leadership to the international trade agenda. I am absolutely delighted to join this hugely exciting new journey.”

Tony Burke is assistant general secretary of Unite

See also: JEFTA: The TTIP-style trade deal you’ve never heard of – and why it matters

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