Brussels is “very close” to a free-trade deal with Japan as negotiators seek to ease anxiety in Tokyo that an agreement could run into the same kind of political trouble that nearly took down the EU-Canada trade pact, Financial Times reports.
At the end of a year in which trade has come under intense political attack in the US and Europe, an EU-Japan deal would boost a policy that is increasingly questioned by populist nationalists as they make big strides against mainstream parties.
Donald Trump, US president-elect, has said he will abandon the ratification of the 12-country Trans-Pacific Partnership deal on his first day in the White House and renegotiate other agreements. Talks on a stalled EU-US deal are set for the “freezer”, EU trade commissioner Cecilia Malmström told the Financial Times. “How deep frozen it will be, we’ll see.”
In an interview, Ms Malmström said Japanese negotiators raised questions about the drawn-out Canadian affair in discussions. “Of course everyone reads the papers . . . But we are committed to try to finalise this,” she said. “We’re very close in finalising.” A breakthrough by the end of 2016 or the beginning of 2017 was still in prospect, she added.
The proposed Japanese agreement is similar in scope to the Canadian deal — known as Ceta — because it is supposed to cover almost all areas of economic activity. Yet the pact would be bigger as the Japanese economy is three times as large as Canada’s.
Talks resume this week in Tokyo. Negotiators are still trying to settle disagreements over auto industry regulations in the Japanese market, and the amount of agricultural goods that Europe could export to Japan. But there are also tensions over the EU’s push for an investment court system similar to the one to be established under Ceta.
Japanese negotiators have seen little need for such courts, which are supposed to replace arbitration procedures in disputes and the Ceta debacle has added to their concerns.
Ceta came under sustained political assault in Belgium as objectors in the French-speaking region of the country questioned the new courts on the basis that they gave too much power to companies to sue governments.