Czech Business Today
EU-Japan FTA goes against protectionist tendencies
The 17th of July marks the signature of the biggest Free Trade Agreement negotiated by the EU – with Japan. The negotiations which started in 2013 were long and complex, but the outcome is important not only for the two partners. In the light of the recent developments in the Unites States and global protectionist tendencies, it is also a strong signal that free global trade is the way forward. The Economic Partnership Agreement (EPA) covers over 600 million consumers and should remove approximately 1 billion EUR worth of duties paid annually. Czech businesses followed the negotiations closely and focused mainly on fulfilling the promise of Japanese government regarding the elimination of non-tariff barriers and the area of standards. The positive outcome of the negotiations is that Japan agreed to take over international standards for motor vehicles, medical devices and textiles. New opportunities for Czech producers should open in the area of agricultural products, a sector that was traditionally very carefully protected by the Japanese. Japan belongs to the TOP 10 of Czech trading partners outside the EU with Czech exports to Japan reaching approximately 0.7 billion EUR last year. Engineering products and vehicles are the main exporting articles, but Czech businesses believe that the EPA will open possibilities for an even larger variety of products. Apart from that, the EU and Japan concluded their talks on reciprocal adequacy at the same day, meaning that the partners will recognise each other’s data protection systems as equal, creating a safe area for free data flow. For Czech businesses, this is also a strong signal of support for global free trade, as a free flow of data is equally important as the free flow of goods and services. Hopefully, the creation of the world’s largest area of safe data transfer will inspire others to drop protectionist tendencies related to data flow, which are unfortunately on the rise.
