During the G20 summit, the European Union (EU) and Japan reached an understanding about an economic partnership agreement, consequently highlighting the importance of free trade and a rule-based global economic order. "We expect a strong tailwind for the German-Japanese economic relations", said Marcus Schuermann, Delegate of German Industry and Commerce in Japan and CEO of the AHK Japan.
Ambitious Agreement of Importance
The European economic relations with Asia are being expanded more and more vehemently. The EU-Japan Free Trade Agreement will affect nearly 30 percent of the global economy and over 30 percent of the global trade. Germany and Japan are enthusiastic supporters and driving forces of the agreement; both countries are expected to significantly benefit from it.
According to a study by the Bertelsmann Foundation, EU exports to Japan could increase by 61 to 162 percent compared to 2014, depending on how ambitiously the contents of the agreement will be drafted and, in particular, to what extent non-tariff trade barriers will be reduced. On the basis of data from 2014, Germany’s Gross Domestic Product (GDP) could increase by 0.7 percent or 20 billion euro – meaning that Germany would obtain the highest absolute GDP growth among all EU member states. The pharma, food, tobacco and automotive industries anticipate especially high gains. In Japan, the computer and electrical industries as well as the engineering and the automotive sectors will benefit.
German Companies in Japan Welcome the Agreement
The Business Climate Survey of the AHK Japan concludes that 54 percent of German companies in Japan expect positive or very positive impacts on their business activities. Furthermore, new impulses for business potentials in third markets are anticipated. For the Asian infrastructure sector in particular, large investments amounting to a total of 22.5 trillion U.S. dollars are expected. This creates substantial business potentials and emphasises the strategic importance of Japan. According to Schuermann, "54 percent of German companies in Japan are already cooperating with Japanese partners in third markets."
The PDF version of the survey can be downloaded here: