The two countries were expected to sign deal on Tuesday, sending a message that free trade lives on despite US protectionism.
After finalizing negotiations last year, the European Union and Japan were on Tuesday officially to sign a free-trade agreement that has been described as the world’s largest.
In creating what will arguably be the biggest open economic area on the globe, the move signals an emphatic rejection of US President Donald Trump’s protectionist policies, which economists fear will lead to a contraction of global trade.
Germany’s Die Welt commented on Monday that the deal was not just historic in size, but marked a moment when Europe moves to fill in a massive gap left by the United States’ withdrawal from its role as a promoter of free trade.
It’s not just about the numbers, it’s also about a signal. The 560 pages of the new European-Japanese document send out a message: that the global economic balance of power is shifting. And to the disadvantage of America.
In essence, the so-called Japan-EU Free Trade Agreement, or JEFTA, provides the following: The Japanese reduce their tariffs on dairy products, meat and wine, while the Europeans lower their taxes on imported vehicles. Some fall immediately to zero, others will be phased out gradually. More economic growth, more jobs – that is the aim of the agreement. Japan, the world’s third-largest economy, is considered an important market for European companies. JEFTA is for both sides the largest trade deal they have ever ventured in their history.
It will be adopted at a time when the world is experiencing an economic exchange. America is trying to reverse globalization. Talks between the EU and Japan began when the US president was still named Barack Obama and free trade was not threatened.…
Donald Trump moved into the White House and issued the slogan “America first,” his code word for protectionism. In the new situation, the Europeans and Japanese agreed surprisingly quickly. Officials finalized the treaty in December 2017, just one year after Trump took office.
“The Trump government’s policy hastened things,” said Irina Angelescu, a Japan expert at the New York-based think-tank the Council on Foreign Relations. According to the analyst, the agreement effectively changed its character. JEFTA was not just an economic contract, but also an answer to American withdrawal. “Europe and Japan,” believes Angelescu, “are positioning themselves more and more as champions of free trade.”
America is currently absent from this role. In March, Trump introduced tariffs on steel and aluminum, and then did so on Chinese engineering goods in July. In addition, he has threatened to impose taxes on cars from Europe, which would be devastating, especially for the German economy. Last week, the US president called on Europeans to accommodate him on trade issues, otherwise, he would take action.…
So that’s the situation the world is facing now: TTIP [the Transatlantic Trade and Investment Partnership] dead for now, TPP [Trans-Pacific Partnership] weakened, NAFTA [North American Free Trade Agreement] endangered – but that’s what JEFTA is for. Europe and Japan have not reached an agreement with the US, but they accelerated the negotiation of their own deal. Free trade, it seems, lives on, despite all attempts from Washington to strangle it. If the United States shuts itself out, its trading partners are looking for new allies. Even an American president, often referred to as the world’s most powerful man, cannot stop globalization.
This article first appeared in the Asian Times