Japan-EU Free Trade Agreements Acknowledging the Theory of Liberalism

Japan’s Free Trade Agreement negotiation with the EU was established in March of 2013 aimed at addressing a number of EU concerns which included the non-tariff barriers which companies of the EU have met in Japan along with providing opportunities for the Japanese public procurement market.
A total of five negotiating meetings have taken place so far, in order to provide progress for this issue.

I will firstly examine Japan’s relations with the EU in order to identify the purpose and benefits that both parties will acquire. Secondly I will observe current talks taking place between the two parties and the progress that has eventuated. Finally I will stress on the fundamental aspects that liberalism has towards to beneficial traits of free trade.

Japan is obviously, the EU’s second biggest trading partner of the EU in Asia, after China. Mutually, the EU and Japan account for more than a third of the world’s GDP. Japan remains a major partner for the EU and also a major investor in the EU so therefore Europe is a crucial market for Japan.
So fundamental are their trade relations that on one hand, EU’s import from Japan includes a vast majority of machinery and transport equipment and chemicals products and on the other, Japan’s imports from Europe include machinery and transport equipment, chemical products and agricultural products.
Since Japan acquires a highly developed economy and is a key global trader and investor it therefore is a crucial partner of the EU.
When observing the EU and Japan’s trade relations, it is evident that it is exemplified by big trade surpluses in already in place. Even though there are challenges from the specific traits of the Japanese society and economy including the business and investment side of the spectrum, trade figures have been reasonable recently.
This is evident when we focus our attention towards a couple of bilateral dialogues, which include a cooperation framework aimed at promoting two-way investment via concrete actions which has been in place since 2004 and the EU-Japan Business Dialogue Round Table, which was established in 1999, that allows for a dialogue and exchange of views between EU and Japanese businesses. There have also been four fundamental agreements established until now between the two parties which include, the EU-Japan Mutual Recognition Agreement, Agreement on Co-Operation on Anti-competitive Activities, Science and Technology Agreement and finally the Agreement on Co-operation and Mutual Administrative Assistance.  

Just recently further progress has been evident as the European Union and Japan are hoping to move swiftly towards a free trade agreement, after Japanese Prime Minister Shinzo Abe held discussion with EU leaders in Brussels.
According to Abe, Japan is well aware of the importance of an early conclusion to the agreement which it will elevate their hopes of increasing their automotive and television exports to the EU, which the EU have acknowledged and in return, aim to promote their cheese and wine exports. Therefore non-tariff barriers such as domestic rules on vehicle safety in Japan are to be lifted and the further progress to take place.
Also important is the estimations by the EU that a free trade agreement with Japan would boost the overall economy by 0.8% and lead to an increase in EU exports to Japan of more than 32%.

It can therefore be acknowledged that the theory of liberalism in regards to free market trade is crucial in international relations and foreign policy and trade. As liberals would believe, unregulated commercial exchanges promote relations across foreign state borders and shifts loyalty away from the nation state. World leaders would concede that benefits of free trade would overcome territorial conquest and colonial expansion. Free trade has an impact that will eventuate in more peaceful means of achieving national wealth since the theory of comparative advantage, would eventually be beneficial than if it pursued nationalism and self sufficiency. Morally, free trade would further develop the levels of understanding between people of different states and promote international friendship and understanding. By lifting the non-tariff barriers would not only unite Japan and the Europe but also avoid conflicts or wars which would place a dent to national harmony of interests commonly shared by the global community.
Therefore when examining the relationship between Japan and Europe, one can distinguish the high level professionalism and the support for liberalism taking place. Both the EU and Japan will benefit from free trade that eventually open up avenues and access not only to economy and trade but also foreign policy and international relations as a whole.

China-Japan Dispute from a Structural Realism Perspective

The territorial dispute between China and Japan has been on-going since 1971. It is centred on whether China, Taiwan or Japan has lawful sovereignty over the islands of Diaoyu, the name given by China, or Senkaku, its Japanese name.

The islands of Diayou or Senkaku, consists of 9 uninhabited islands  and rocks with a total surface area of around 6.5km, which lie approximately 170km to the south of the Japanese Island about  370km from the to the west of the nearest Chinese mainland and around  180km from the SW coast of Taiwan.

 I shall first examine the historical aspects of this dispute in order to determine the positions of both states in laying claim towards these islands.  

Japan argues that they lawfully acquired the sovereignty of the Senkaku Islands since their formal annexation in 1895 when the island was uninhabited and ‘terra nullus’ or belonging to no one. Prior to that they had carried out surveys on the island between 1885 and 1895 to determine its legal status. Japan argues that China only became interested in the islands in 1971 after reports were published regarding the East China Sea and its potential for mineral resources exploitation.

China however claims that the islands have always been in their possession. This would have made the annexation by Japan unlawful. China further maintains that it had previously performed administration work towards the islands, including piracy control. According to China in 1895, following the China-Japan war, it was forced to cede the island of Taiwan (Formosa) to Japan, together with all islands belonging to Formosa under the Treaty of Shimonoseki, which from China’s view was an unequal treaty. At the end of World War 2, when all Chinese territories and islands were returned to Chinese authorities by Japan,  Diaoyu islands was arbitrarily included by the  US i under its trusteeship of Nansei Island,  established under the Peace Treaty of San Francisco to which China is not party to.    

The islands themselves have little military and strategic importance. The real interest for these islands lie in its rich natural resources potential and oil, gas and minerals from the surrounding South China sea region.

I argue that the best possible approach to this dispute is to apply a structural realistic framework. First, is to assess this dispute firstly under International Law and Law of the sea, in which all islands generate maritime jurisdictional zones, also included is the states Air Defence Zone and the coastal state has the authority to manage the natural resources. This must be distinguished from the territorial sea, which covers a maximum of 12 nautical miles (22km of exclusive economic zone (EEZ) that may be established up to 200 nautical miles (370km) from the islands.

To relate this to the territorial dispute between China-Japan, it is evident that these maritime jurisdictional zones may overlap between the two countries.
This will require the delimitation of a maritime boundary between China and Japan. However, for this to eventuate the territorial dispute must have been resolved or there must be another arrangement pending the resolution of the territorial dispute. Both states pursue the opportunity for gaining power over the islands, whether for its potential resources or the advantage over its rival.
It is obvious that a form of structural realism is present after the two states have decided to balance negotiation by signing the Japan-China Peace and Friendship Treaty, in which the dispute over the islands has been suspended pending future settlement.

The territorial dispute between the two states indicates an emphasis on the structure of international politics. The two states have resorted to current resolution in respect of the international relations system that forces them to avoid war at all costs. Japan is prohibited under Article 9 of its Constitution, from engaging in another war since World War 2. China uses the same position hence a peace treaty to negotiate the dispute seems the best solution.  Both states wish to obtain the greater good for their own benefits but being conscious of their international obligations under the UN Charter to avoid force and violence, they must negotiate a peaceful settlement. During the early parts of this dispute, both states stake their claims on the islands but avoid violent confrontation with each other. As time progresses tensions build, possible confrontations are evident; however both states negotiate to avoid war which could be costly for the well being of both states in which population, military power, geography, economy and other important factors in foreign relations will be affected. This is a clear indication of the theory of structural realism where states without the employment of human nature as argued by Morgenthau, behave the way they do because the international system is set out in a way that prevents them from maximizing their powers of the territories.    

The international community cannot interfere in the sovereignty of these two states also in accordance with the UN Charter, so it is up to for the two countries to   compromise. When that will happen is anyone’s guess. However, it is certain that the two countries must negotiate for a peaceful settlement. An appeal to a third party should only happen as a last resort.