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Japan

Japan

In July 2012 an impact assessment of the future Free Trade Agreement was released. Then the EU-Japan Free Trade Agreement negotiations were officially launched on 25 March 2013. The negotiations aim at concluding an ambitious and mutually beneficial trade agreement which will lead to economic growth both in the EU and in Japan. During the negotiations a number of EU concerns will be addressed, including the non-tariff barriers which European companies encounter in Japan and the further opening of the Japanese public procurement market.

There have been ten negotiating rounds so far (in April, June, and October 2013, in January, March/April and July, October and December 2014, and in February 2015 and April 2015).

After the first year of negotiations the Commission provided to the Council a report assessing the progress achieved during the first year of negotiations with Japan. This review had been foreseen in the original negotiating mandate for the EU. Since this review the negotiations have been continuing with added momentum. Japanese Prime Minister Shinzo Abe has expressed several times the objective of concluding the negotiations by the end of 2015. The EU can subscribe to this objective provided that the substance is right and that the level of ambition of the agreement is high enough. The next round of negotiations will be held in Brussels in summer 2015.

Trade picture

  • Japan is the EU’s second biggest trading partner in Asia, after China.
  • Together the EU and Japan account for more than a third of the world's GDP.
  • Japan remains a major trade partner for the EU and Europe is a very important market for Japan. Japan is also a major investor in the EU.
  • Imports from Japan to the EU are dominated by machinery, electrical machinery, motor vehicles, optical and medical instruments, and chemicals.
  • EU exports to Japan are dominated by motor vehicles, machinery, pharmaceuticals,  optical and medical instruments, and electrical machinery.

EU-Japan "trade in goods" statistics

Trade in goods 2012-2014, € billions
Year EU imports EU exports Balance
2012 65.0 55.7 -9.3
2013 56.6 54.0 -2.6
2014 54.6 53.3 -1.3

EU-Japan "trade in services" statistics

Trade in services 2011-2013, € billions
Year EU imports EU exports Balance
2011 15.6 22.1 6.5
2012 15.7 24.0 8.3
2013 14.6 24.7 10.1

Foreign direct investment

Foreign direct investment 2013, € billions
Year Inward stocks Outward stocks Balance
2013 160.5 78.9 -81.6

More statistics on Japan

EU and Japan

As a highly developed economy and a major global trader and investor, Japan is an important partner for the EU. Japan is the world's fourth largest national economy.

The trade relationships between the EU and Japan have been traditionally characterised by big trade surpluses in favour of Japan. Trade figures have become much more balanced in recent years, but Japan continues to be a country where, due to the specific features of the Japanese society and economy, doing business or investing is often challenging.

To facilitate the trade relationships between the EU and Japan, a number of informal bilateral dialogues have been established:

  • A Cooperation Framework aimed at promoting two-way investment via concrete actions exists since 2004.
  • The EU-Japan Business Round Table - established in 1999 - allows for a dialogue and an exchange of views between EU and Japanese businesses.
  • Since 1979 the European Commission has been encouraging European enterprises to penetrate the Japanese market and has given them concrete assistance through promotion programmes such as the Executive Training Programme and the EU Gateway Programme
  • The EU-Japan Centre for Industrial Cooperation is a unique venture between the European Commission and the Japanese Government. It was established in 1987. The Centre promotes all forms of industrial, trade and investment cooperation between the EU and Japan. By facilitating exchanges of experience and know-how between EU and Japanese businesses the Centre helps to improve the competitiveness of both EU and Japanese companies.

Four important agreements been concluded until now between the EU and Japan.

Trading with Japan

EU-Japan Strategic Partnership Agreement

A Strategic Partnership Agreement between the EU and Japan is being negotiated in parallel with the Free Trade Agreement.