On 1 February 2019, the European Union (EU) and Japan signed an economic partnership agreement, better known as the EU-Japan Economic Partnership Agreement (EPA) or the Eurlex Agreement. This deal is considered one of the largest open-trade agreements in the world, as it covers approximately 30% of global GDP.
The Eurlex Agreement aims to facilitate trade between the EU and Japan by reducing tariffs, increasing market access, and eliminating non-tariff barriers. It also promotes sustainable development by incorporating environmental and labor standards. As such, this agreement marks a significant step towards strengthening economic and political ties between Europe and Asia.
Specifically, the Eurlex Agreement aims to:
1. Remove tariffs on goods: The EU and Japan will eliminate tariffs on many goods, including agricultural products such as wine, cheese, and pork. This will increase competitiveness for EU exporters and provide Japanese consumers with cheaper and higher quality products.
2. Provide market access: The Eurlex Agreement provides the EU with improved access to the Japanese market for services, such as financial and transportation services. It also enables EU companies to participate in public procurement tenders in Japan.
3. Address non-tariff barriers: The agreement addresses non-tariff barriers, such as regulatory differences, that hinder trade. It establishes a regulatory cooperation framework that will promote alignment on standards and regulations, facilitating trade between the EU and Japan.
4. Promote sustainable development: The Eurlex Agreement incorporates provisions that promote sustainable development, such as responsible business conduct, labor rights, and environmental protection. The agreement also includes a mechanism for resolving disputes related to labor and environmental standards.
The Eurlex Agreement is expected to have a positive impact on both economies. The EU is Japan`s fourth-largest trading partner, and Japan is the EU`s second-largest trading partner in Asia. By reducing trade barriers, the EPA is expected to boost EU exports to Japan by 34% and Japanese exports to the EU by 29%.
In addition to economic benefits, the Eurlex Agreement is also significant from a geopolitical perspective. It sends a strong signal against protectionism and highlights the importance of multilateralism in securing global economic stability.
In conclusion, the Eurlex Agreement between the EU and Japan marks a significant milestone in international trade agreements. This deal has the potential to promote economic growth, sustainable development, and stronger political ties between Europe and Asia. As such, it is a positive step towards a more connected and globalized world.