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27/08/2016

Stitching up the EU-Japan Trade Deal

Global Europe

Stitching up the EU-Japan Trade Deal

A trade deal with Japan could have a knock-on effect on European innovation, as well as being economically beneficial.

[Maarten Heerlien/Flickr]

After thirteen negotiating rounds, the ambitious target of finalising the EU-Japan Free Trade Agreement has now been set. The textile and fashion sector gives an example of what can be gained, writes Isabelle Weiler.

Isabelle Weiler is trade and industry manager at the European Apparel and Textile Confederation

The textile and clothing sector is a growing industry worldwide. Operating in a very competitive environment, the EU and Japan are keeping the leading roles in the development of advanced technological materials and creating high quality fashion goods.

Both the EU and Japan are key export markets for the respective industries. For the EU’s textile and clothing sector, Japan is among the top ten largest customers with the exports reaching more than €1.8 billion in 2014.  For the Japanese industry, the EU is the 2nd export market reaching almost €0.6 billion.

The trade structure between the EU and Japan textile and fashion industries is complementary, which is a rare advantage. The EU mainly exports clothing – and in particular deluxe products made from wool and silk, while it imports fibres and yarns from Japan.

Win-win situation

Japanese and European textile and fashion sectors face similar challenges and they are assured that the Free Trade Agreement will be beneficial for their companies increasing trade and investment potential. A comprehensive trade deal will build platforms for R&D cooperation creating innovation and business opportunities.

Euratex (European Apparel and Textile Confederation) is working closely with Japan Textile Federation on the crucial issues in the future agreement – namely, elimination of tariffs and improvement of regulatory cooperation.

Full elimination of tariffs, which will mean duty free access from day one for all textile and clothing products, will be beneficial for both industries. Currently, the tariffs are quite similar in both parties; duties can be up to 11% when exporting clothing to Japan. The trade deal shall as well result in simplification of burdensome customs procedures, which will facilitate exports for our industry largely composed of SMEs.

At the centre of the deal is the improvement of regulatory cooperation in the matters like labelling, intellectual property rights and public procurement. The high level of quality and consumer protection shall be preserved at both markets, while the producers will avoid costly and heavy obligations. Good results have already been achieved regarding standards on care instructions as Japan recently decided to recognise the ISO standards used by our producers.

Japan with its progressive technologies is already one of the EU’s most advanced partners. The trade deal will have a positive impact not only on the flow of goods between the countries, but will also enhance the spill over effect in innovation. And that’s exactly what the competitiveness of our industry can take advantage from.