EU Trade Talks with Mexico, Japan Continue, Aiming for Deals in Near-Term

13 April 2017

Negotiations for both an EU-Mexico trade deal upgrade and a new EU-Japan trade agreement continued last week, with officials in both contexts suggesting that these efforts are progressing steadily.

Regarding the EU-Mexico economic agreement, last week’s talks in Brussels marked the third negotiating round. The focus of these efforts is to upgrade the 17-year-old Global Agreement, which some officials now say could be accomplished by the end of the year.

"It's paramount. Right now there's no other issue, no other negotiation on top of the trade agenda for Mexico but this one," said Juan Carlos Baker, Mexican deputy foreign minister, to Reuters last week.

Negotiations to update the existing accord began last year, with officials saying at the time that this effort would bring the deal in line with the new global trade and economic landscape. (See Bridges Weekly, 23 June 2016)

The two trading partners have since been eager to advance the negotiations, producing a new accelerated schedule in February which includes this weeks’ talks. Amid the triggering of Article 50 for Brexit and the new US administration’s move towards more inward-focused policies, both EU and Mexican officials have said that these policy shifts abroad can also provide them with opportunities to cooperate. (See Bridges Weekly, 8 December 2016)

The EU is Mexico’s third-largest trading partner after the US and China. In 2015, Mexico was the second-largest export market for the EU after the US. The EU is also a major investor in Mexico with €119 billion (US$127 billion) in foreign direct investment (FDI) in 2014.

Six initial proposals from the EU were sent to Mexico in November 2016 and have lately been published by the European Commission, in what the executive branch describes as an effort to increase transparency and widen the range of inputs. The Commission has also set up a transparency page to make trade documents more accessible.

The textual proposals include rules of origin, public procurement, sanitary and phytosanitary measures, energy and raw materials, intellectual property rights, and small and medium-sized enterprises (SMEs) Reports of the first and second rounds of negotiations are also publicly available.

The fourth round of negotiations will occur on 26-29 June, in line with the schedule previously announced.

EU-Japan trade talks

Meanwhile, the EU and Japan held their 18th round of negotiations from 3-5 April, with the talks led by Mauro Petriccione for the EU and Yoichi Suzuki on behalf of Japan. After the meetings in Tokyo, the Ministry of Foreign Affairs of Japan said that “fruitful discussions were conducted on areas such as trade in services, intellectual property rights, non-tariff measures, government procurement, and investment.”

The European Commission also described the round of trade talks as progressing in a “constructive atmosphere,” with all negotiating topics being discussed.

The EU-Japan trade talks were launched four years ago, and officials say they now hope to finalise negotiations by the end of the year. Among the more complicated issues remaining are agriculture and automobile market access, as well as non-tariff barriers, among others. (See Bridges Weekly, 8 December 2016, 27 March 2013, 23 March 2017, and 23 February 2017)

Together, the EU and Japan make up more than a third of the world’s GDP. Officials say that a deal between these trading giants could set a strong example of the benefits of building economic ties at a time when trade and globalisation are facing greater public scrutiny.

“There is an ongoing vibrant public debate on trade and globalisation, and we are now applying the lessons learnt from this debate in our negotiations with Japan,” said EU Trade Commissioner Cecilia Malmström in a blog post on 11 April.

“Strengthening the partnership with our closest Asian ally, building bridges between us, is now needed more than ever as we face rising protectionism around the world. An EU-Japan trade deal would send a powerful signal,” she added.

The EU published two proposals for the negotiations with Japan last month: one on supporting the needs of small and medium-sized enterprises and another on promoting good regulatory practices and regulatory cooperation, including improved bilateral cooperation on the international level and facilitating a more predictable regulatory environment.

ICTSD reporting; “New negotiator to head Japan’s FTA talks with EU next week,” THE JAPAN TIMES, 30 March 2017; “EU, Japan determined to deliver trade deal by the end of 2017,” EURACTIV, 21 March 2017; “EU, Mexico to speed up trade talks amid Trump fallout,” ASSOCIATED PRESS, 1 February 2017; “Mexico says new EU trade deal is ‘paramount’, eyes 2017 conclusion,” REUTERS, 4 April 2017. 

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