EU Optimistic On Japanese Trade Talks

European Commissioner for Trade Cecilia Malmström chats with Japanese Foreign Minister Fumio Kishida | Pool

"We've reached political agreement at Ministerial level", Malmstroem said on Twitter.

Prime Minister Abe should now sign the "political agreement" with European Union institutional chiefs Mr and Donald Tusk on Thursday in Brussels.

The Commission has insisted that the EU-Japan will be the most important bilateral trade agreement ever concluded by the EU and, as such, will for the first time include a specific commitment to the Paris climate agreement.

Negotiations on an EU-Japan trade deal have been underway since March 2013 and are well advanced.

In the negotiations, Japan and the EU have already reached a basic agreement to work toward the elimination of the EU's tariffs on Japanese-made electronic devices such as home electronics and automobile parts, as well as Japan's tariffs on European-made clothes and wine produced in Europe. (Duties would come down more rapidly for some auto components.) That is a key concession: The Japanese automotive giants Toyota and Honda have claimed a smaller market share in Europe than in other major markets like the United States.

With the Hamburg G20 Summit to be held on Friday and Saturday, the timing of the EU-Japan agreement appeared to be meant to send a message to fellow world leaders. "Enterprise Ireland's strategic focus is to help clients grow exports to Japan in the medtech, aviation, fintech and agri-tech sector and the tariff elimination on medical devices and pharmaceutical products in particular is good news for Irish exporters", said Mr Adams.

Non-tariff measures are also being agreed, including Japanese alignment with global standards, and regulatory cooperation aimed at creating common standards.

Last year, the EU's giant CETA trade deal with Canada almost sank on such concerns when the small Belgian region of Wallonia threatened to veto it, before eventually relenting. Japanese vehicle makers will get better access to the European Union market. EU official insist that the deal would be a major boon for European farmers who would gain access to a huge market that appreciates European products.

The leaders hailed the agreement as evidence that free and fair trade can go hand-in-hand, and that protectionism has no winners. The two sides will also scrap their tariffs on wine as soon as the pact comes into force, while duties on European chocolates and pasta will be scrapped in 10 years, the source said. Japan is the EU's second largest trading partner in Asia after China, and the EU's sixth most important trading partner worldwide.