EU trade chief urges trade deal talks with Japan
Source: Agencies |
July 19, 2012, Thursday
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THE European Union's trade chief called on Europe yesterday to start talks on an ambitious trade deal with Japan despite opposition from carmakers, saying that overlooking one of the world's biggest economies would be a "serious mistake."
The EU is in a race with the United States to sign dozens of free-trade deals across the globe and lock in access to fast-growing economies, especially in Asia, as the 10-year Doha round of global trade talks are deadlocked.
"If growth in the next 20 years is likely to come from Asia, then overlooking Japan would be a serious mistake in our trade strategy," Trade Commissioner Karel De Gucht said in a speech in Brussels following the European Commission's decision to ask EU countries for a mandate to negotiate with Japan on their behalf. The decision was expected, and the Commission must still win the approval of the EU's 27 countries to proceed with talks. But there is a consensus at least to start negotiations, diplomats say.
A deal with Japan, which could be sealed in a couple of years if countries approve the Commission's request for a mandate by the year's end, could increase the EU's economic output by almost a percentage point and increase EU exports to Japan by a third, the Commission says.
That could create 400,000 jobs in Europe, an attractive proposition at a time when unemployment in the 17-nation eurozone is a record high and several large EU economies, including Spain and Britain, are in recession. "Let's be clear: We need these jobs, and we need this growth in the current economic climate," De Gucht said.
There is barely a corner of the world where the EU is not negotiating trade deals, but the bloc has yet to seal an accord with a major world economy. A deal with Japan would probably follow a pact with Canada that is expected by the end of this year, building on last year's agreement with South Korea.
The EU says that signing trade accords with more than 80 countries where negotiations have already begun-including India-could create 2 million new jobs and make a 275 billion euro (US$340 billion) contribution to the European economy.
A free-trade agreement with Japan is not assured, however, and the European Parliament must sign off on any final deal. Issues such as public procurement, ranging from building roads to supplying software, and openness to car imports are potential conflict areas.
Italian and French makers of autos and autoparts, struggling with weak demand at home, say that if the South Korea-EU trade deal is any yardstick, they will not have the access they hoped for in Japan and do not welcome more competition at home.
Since the South Korea pact came into effect on July 1 last year, Seoul has increased its sales to Europe by double digits. European makers say the close ties between carmakers and their suppliers in Korea make it hard for foreign parts makers to break into the market there.
The EU is in a race with the United States to sign dozens of free-trade deals across the globe and lock in access to fast-growing economies, especially in Asia, as the 10-year Doha round of global trade talks are deadlocked.
"If growth in the next 20 years is likely to come from Asia, then overlooking Japan would be a serious mistake in our trade strategy," Trade Commissioner Karel De Gucht said in a speech in Brussels following the European Commission's decision to ask EU countries for a mandate to negotiate with Japan on their behalf. The decision was expected, and the Commission must still win the approval of the EU's 27 countries to proceed with talks. But there is a consensus at least to start negotiations, diplomats say.
A deal with Japan, which could be sealed in a couple of years if countries approve the Commission's request for a mandate by the year's end, could increase the EU's economic output by almost a percentage point and increase EU exports to Japan by a third, the Commission says.
That could create 400,000 jobs in Europe, an attractive proposition at a time when unemployment in the 17-nation eurozone is a record high and several large EU economies, including Spain and Britain, are in recession. "Let's be clear: We need these jobs, and we need this growth in the current economic climate," De Gucht said.
There is barely a corner of the world where the EU is not negotiating trade deals, but the bloc has yet to seal an accord with a major world economy. A deal with Japan would probably follow a pact with Canada that is expected by the end of this year, building on last year's agreement with South Korea.
The EU says that signing trade accords with more than 80 countries where negotiations have already begun-including India-could create 2 million new jobs and make a 275 billion euro (US$340 billion) contribution to the European economy.
A free-trade agreement with Japan is not assured, however, and the European Parliament must sign off on any final deal. Issues such as public procurement, ranging from building roads to supplying software, and openness to car imports are potential conflict areas.
Italian and French makers of autos and autoparts, struggling with weak demand at home, say that if the South Korea-EU trade deal is any yardstick, they will not have the access they hoped for in Japan and do not welcome more competition at home.
Since the South Korea pact came into effect on July 1 last year, Seoul has increased its sales to Europe by double digits. European makers say the close ties between carmakers and their suppliers in Korea make it hard for foreign parts makers to break into the market there.
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