Japan’s lower house of parliament on Thursday cleared a bill to ratify a free trade agreement with the European Union, paving the way for its passage through the upper house by year-end.
Both Japan and the European Union plan to complete their respective procedures by the end of the year, with an eye to the pact’s entry into force in February.
The agreement, signed in July, will create a free trade zone covering about a third of global gross domestic product and will eliminate tariffs on most imports between Japan and the European Union. Japanese consumers will gain access to cheaper products such as cheese, wine and pork under the pact.
The two sides had rushed to wrap up five years of negotiations amid concern about protectionism as U.S. President Donald Trump is seeking to advance his “America First” agenda. Following a U.S. withdrawal, a revised 11-member Trans-Pacific Partnership free trade deal is set to come into force on Dec. 30.
Under the FTA with the European Union, Japan will eliminate duties on around 94 percent of all imports from the block by 2035. The European Union, meanwhile, will get rid of tariffs in stages on around 99 percent of imports from Japan, such as cars.
This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.