Europe struggles to convince Japan on multilateral agenda

Italian Prime Minister Giuseppe Conte and Japanese Prime Minister Shinzo Abe attend a press conference after their meeting at Chigi Palace in Rome, Italy, 24 April 2019. Abe is on an eight-day European and North American trip, ahead of the G20 hosted in Japan later this year. [EPA-EFE/ETTORE FERRARI]

EU leaders will meet with Japanese prime minister, Shinzo Abe, in Brussels on Thursday (25 April) to progress on the bilateral relations, although Tokyo has been reluctant to follow the European ambition on trade and climate action.

The presidents of the European Commission and European Council, Jean-Claude Juncker and Donald Tusk, will hold talks with the Japanese leader and are expected to welcome the early results of the new economic partnership.

After this agreement entered into force earlier this year, almost all European exports to the Japanese market are exempt from any tariffs.

EU and Japan 'cement' relationship against Trump’s protectionism

The European Union and Japan signed a long-awaited commercial trade deal on Tuesday (17 July), in an emphatic statement meant to counter US President Donald Trump’s attacks against free trade and the rules-based international order.

According to a senior EU official, both sides are “fully committed” to widening the bilateral relationship based on a solid legal framework.

But as reported last week, Japan, pressed by US administration, is dragging its feet on the reform of the World Trade Organisation and on the climate agenda.

Trump presses Japan to reject EU demands on WTO reform

Japan refuses to include a reference to a proposed reform of the WTO’s appellate body in the draft conclusions of an upcoming bilateral summit with the EU for fear of upsetting the US, has learned.

These two issues have become the main bone of contention in the global multilateral system following Donald Trump’s election victory, and will likely remain “hot issues” at the next G20 summit to be chaired by Japan in Osaka in June.

Despite being “like-minded partners”, the European side convinced Japanese negotiators to include only a vague reference to cooperation on the reform the WTO’s appellate body, seen as a “joint priority”.

However, Japan did not support a Brussels proposal on this matter to unblock the nomination of new judges.

Instead, Japan and Australia put forward their own ideas on 19 April, breaching the consensus the European Commission was trying to build around its own plan.

Their offer responded to some of the previous concerns raised by Washington, including the limitation of the world trade body’s competences and decisions.

The appellate body will need to appoint at least two members by the end of this year to continue functioning, or the whole WTO framework could be at stake.

US says it cannot support some of EU's ideas for WTO reform

The United States gave the first hint on Thursday (4 October) of its view of attempts to reform the World Trade Organization, rejecting some proposals put forward by the European Union to resolve a crisis at the home of world trade in Geneva.

The US has been highly critical of the appellate body and wants to curtail its role.

For Europe, it represents a fundamental piece needed to ensure that the ongoing trade tensions can be channelled through the multilateral system.

Another EU source said that both sides are aligned when it comes to the principle of reforming the appellate body to avoid a weakening of the multilateral framework, and Japan is “open and ready” to engage with any proposal.

Climate ambition

On another key issue, Tokyo is not sharing the EU’s ambition in the fight against global warming. Senior EU officials regretted that Japan did not want to commit to the acceleration of the implementation of the Paris Agreement, which Trump has rejected.

Prime Minister Abe does not want to infuriate the US president by moving closer to the European agenda on the WTO reform and climate just days before his visit to the White House.

In Brussels, officials are aware of the important role that the US continues to play as a security partner for Japan, especially against the backdrop of China’s rise in the Pacific.

G20 struggles to agree on watered down declaration

The Group of Twenty most powerful nations were nearing an agreement late on Friday (30 November), in which a reference to a rules-based multilateral trade system was expected to be included. But ambition was lowered in the climate field to overcome the US opposition to the Paris Agreement.

The Japanese premier is touring several major partners in order to prepare the next G20 summit, in particular to narrow the differences between the US and Europe.

Before arriving to Brussels, Abe visited France, Italy and Slovakia.

Although Europe wants a “meaningful and substantial outcome” in Osaka, European officials admitted that this would not depend only on the “goodwill” of the Japanese presidency.

[Edited by Zoran Radosavljevic]

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