Japan, EU to sign trade deal eliminating almost all tariffs

EU and Japan sign trade deal covering a third of the world's economy

Japan, EU signs trade pact that will eliminate nearly all tariffs on traded goods

"In giving full effect to this agreement, the European Union and Japan are sending a powerful message to promote free, fair and rules-based trade, and against protectionism".

Paul James Cardwell, a professor from Strathclyde University, said: "The U.K.is a large economy but based on services, and countries are generally reticent to include them in free trade agreements".

Japan's ambassador for global economic affairs, Yoichi Suzuki, said earlier this year that if an EU-Japan deal were in force in the United Kingdom during the Brexit transition phase, it would buy Japan more time to establish a separate trade deal with Britain.

The pact creates the world's largest open economic area, covering almost a third of the world's economic output and 600 million people, BBC reported.

"There are rising concerns about protectionism, but I want Japan and the European Union to lead the world by bearing the flag of free trade", Prime Minister Shinzo Abe said at a news conference after the signing ceremony.

Overall, European farmers will benefit, Juncker said, though European consumers will be able to more easily buy luscious Kobe beef and famous Yubari melons.

The conclusion of the trade agreement was sped up a year ago - putting aside the controversial issue of dispute settlements - as a reaction to Trump's election and first questioning of the worldwide order.

However, Japan's dairy industry is expected to lose market share to European products once tariffs of up to 40 percent on some cheese imports start falling.

The deal was also struck amid turmoil in Britain with the United Kingdom yet to agree how its final trading relationship with the European Union will work after Brexit. Following the signing ceremony, they will seek parliamentary ratification.

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The wide-ranging agreement is set to remove 99 per cent of the tariffs applied on EU exports to Japan, which amount to about €1 billion, in a boost to European food and drink producers, including wine and cheese makers, in particular.

Japan's ambassador for global economic affairs, Yoichi Suzuki, has previously said it was 'a very high priority that [the deal] enter force before the end of March 2019, ' referring to the date when Britain is set to leave the EU.

"Today's signature of the EU-Japan Economic Partnership Agreement is a landmark moment for global trade", he said.

President Juncker added that there would be an immediate tariff elimination of up to 4% on over 90% of Japanese auto part and of all tariffs on cars within the next seven years.

Shinzo Abe had been scheduled to sign the deal in Brussels last week, but cancelled his trip after devastating floods that killed more than 220 people.

The regional bloc will immediately eliminate tariffs on Japanese sake, green tea and soy sauce, while wine will also be reciprocally traded without tariffs right after the pact comes into force.

The EPA took over four years of negotiations in which both sides faced difficulties regarding procedures to settle investment disputes between companies and governments.

"Politically, it's a light in the increasing darkness of worldwide politics", Tusk said. The White House has imposed tariffs on EU steel and aluminum imports and has threatened to target European cars next.

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