EU and Japan enter talks over non-tariff barriers
Final agreement might not come into force until 2015
European Union (EU) and Japanese pharmaceutical exporters could benefit from a future free trade deal, after the European Commission said that formal trade talks between these two developed world giants will go ahead.
Brussels’ directorate general for trade is stressing that Japan must make offers to remove its notoriously tough non-tariff barriers – such as trade licensing, declarations, inspections, labelling, certification, port clearance and other red tape.
‘We explicitly reserve ourselves the right 'to pull the plug' on the negotiations after one year if Japan does not live up to its commitments on removing non-tariff barriers,’ said EU trade commissioner Karel De Gucht.
The Commission is convinced that there is money to be made in Japan. The EU exported US$7.6bn of pharmaceutical products to Japan in 2011, says international trade data, an amount that has been steadily increasing from US$3.9bn in 2007.
Currently, the EU medicines sector is lightly defended by tariffs against Japanese imports – indeed most pharmaceuticals enter duty free. The same applies for Japan’s pharma sector – EU-made medicines largely enter Japan duty free. But the real progress is needed made over non-tariff barriers, said the Commission.
The talks are expected to continue into 2014 and a final deal might not come into force until 2015 or later.