UK’ s key role in deal that could increase trade by € 1trn
INTERVIEW
EU – Japan FTA: Update
UK’ s key role in deal that could increase trade by € 1trn
By Julian Ryall
A
30-strong delegation from the European Commission held a second round of discussions on a Free Trade Agreement( FTA) with Japan over 10 days in Tokyo in late May and early June.
The first round of talks, held in Brussels in April, is considered to have been a success. There are high hopes that an agreement can be reached that is worth around € 1trn in increased trade between the two blocs. A significant portion of this will come from the UK, where bilateral trade with Japan is running at around £ 18bn a year.
Antonio Parenti, deputy head of the European Commission’ s Far East Unit, gave BCCJ ACUMEN an update on the progress of the discussions.
How would you describe progress to date in talks on an FTA?
We are still at the beginning of the discussions and it will be a long and complicated process.
So far, we are at the stage of better defining how we can achieve the goals we set out in the preparatory stage. We are preparing the ground for entry into the more substantive part of the negotiations.
I believe [ the process ] has been going according to plan, and we have had two positive meetings. I don’ t think either side expected a breakthrough at this stage but, that notwithstanding, we have seen progress in terms of understanding each other’ s position and I feel that will pay off as we go forward.
Antonio Parenti is deputy head of the European Commission’ s Far East Unit.
© EUROPEAN UNION, 2013
Jun Yokota, chief negotiator, and Mauro Petriccione, a director for development and management of trade relations
How long do you expect the discussions to continue?
It’ s very difficult to say. If you look at how long it took to reach an agreement with South Korea, that was about two-and-ahalf years.
I think that, given the time these types of efforts require on both sides, that [ time frame ] is a reasonable expectation for these discussions.
If it can be done faster, the European side is ready to move forward faster— but not at the expense of substance. This is for the negotiating process, however, and after that will come the ratification process.
Which areas are progressing most smoothly? We have 15 working groups. None of these groups has yet got down to negotiations on the treaty texts.
We are therefore still in the process of explaining what we are looking for, why we want it— and then understanding what the Japanese side wants and why they want it.
I think at this stage we can say there will be areas that are easier to negotiate than others but, overall, the principle of negotiations is that nothing is agreed until everything is agreed.
Which areas will be easier to negotiate? The institutional issues will most likely be easier in areas such as dispute settlement mechanisms. All the rest will be more complicated, to varying degrees.
We are talking about two major economies that want to integrate here, after all. This agreement will only make sense if we create an economic environment in which companies of both countries can compete in each other’ s markets on a fair basis.
How does the EU team prioritise trade issues it wishes to negotiate from the long list of measures to be debated?
We are not at the point of prioritising issues yet. This will only come in the later stages for both sides. This will be the crucial time in the discussions.
Negotiations are [ deemed ] successful if both [ the EU and Japan ] are able to make compromises that are mutually acceptable.
Will you be calling on EU firms to support the negotiations later? If so, how will you do this?
EU companies have already been asked to support the talks and have been contributing. We are definitely looking for their continued support.
I think it is fair to say that we need them to help create solutions. We want, and need, that for the companies operating in Japan.
We need to know their concepts for this market, the problems that they face, and if the solutions we are creating are effective in solving common problems and avoiding the creation of new problems.
22 | BCCJ ACUMEN | JULY 2013