A prospective trade agreement between the EU and Japan will have wide ranging and positive consequences for the shipping industry. For container carriers, in particular, a finalized trade agreement – which, according to economists, would increase the European export to Japan by 22-32 percent – would have a significant impact, writes analyst agency SeaIntel in their weekly Sunday Spotlight.
The trade agreement between the two major trade regions is also expected to increase Japanese exports to Europe, by 17-24 percent. Approximately 80 percent of the growth in trade will consist of physical commodities, to be transported by either ships or planes.
On November 29th, the EU countries decided to initiate negotiations with Japan concerning a free trade agreement. The Japanese economy is currently struggling with the global crisis, and was in recession in the second and third quarters, according to numbers released by the Japanese authorities on Monday.
According to the EU Commission, a future free trade agreement would, in Europe, create 400,000 jobs and increase the European gross domestic product by one percent. As such, the agreement is a central part of an attempt at kick starting the growth in Europe.
The benefit is expected to come from lower toll duties and by removing a series of rules, initiatives that are expected to increase European exports. Right now, complex rules make it difficult for foreign companies to enter the Japanese market.
The agreement has been underway for some time, because – in spite of major benefits for the European Union as a whole – several minor industries could risk losing money, especially the automobile industries in France, Spain, and Italy.
Estimates say it will take two to three years before the final trade agreement is in place. Danish Agriculture has already done calculations showing that increased free trade with Japan would result in an additional USD 173 million a year for Danish food exports alone.
More from ShippingWatch
SDK Freja anticipates steep earnings drop following record year
Logistics company SDK Freja, which delivered record financials with great advancement on top and bottom lines, takes a more gloomy view of the current fiscal year due to several ”external factors.” However, the growth target remains the same, CEO tells ShippingWatch.
Draft and bottlenecks have become new barriers for grain exports out of Ukraine
With major ports mined and few exits out of Ukraine, small ships are piling up in an attempt to export grain. CEO of bulker company BPG Shipping/Kronos Bulkers Gennadiy Ivanov presents his views of the impact of the war.
LNG carriers concerned about increasing ship prices
The price on new LNG vessels has soared vigorously, and for Flex LNG this has meant a withdrawal from the market for new ships. Such was the statement by Flex LNG’s chief exec at Marine Money in New York, where he also announced new long-term charter agreements.
Maersk ships delayed up to three weeks on US east coast
Bottlenecks at major container ports on the US east coast have entailed that Maersk vessels are affected by delays of up to three weeks. It’s a combination of congestion, many ships, and a lack of container space, Maersk says.
Desmi founder on selling life's work: "A company of a certain age, you can't own forever"
Despite a big, long-awaited sale, Henrik Sørensen continues at the helm of his life’s work, maritime technology provider Desmi. In an interview with ShippingWatch, the Danish owner elaborates on the decision to sell a majority stake and the next step for the pump manufacturer.
IT Operations & Project Lead 
Data Scientist - Transition, Modelling & Analytics 
Senior Legal Counsel with a focus on Offshore Renewables 
Head of Airfreight 
Head of Vessel Operations