Japan. EU Reaffirm Global Free Trade: Updated May 13, 2025

Japan, EU reaffirm collaboration in maintaining global free trade

Article source: https://mainichi.jp/english/articles/20250509/p2g/00m/0bu/010000c

Ideas:

Japan and the EU have a free trade agreement and they are communicating that free trade is the main course of action for the global economy. 

The global economy, for the most part, has worked quite well since WW11, but the US administration wants to make it work in their favor, which is going to upset the entire free trade and global logistics system in place.

In recent days there have been news about the US/US trade agreement, but to be honest its not much of an agreement and only makes the US look good or make it look like it was landmark deal, which it wasn't.

And also in recent days the US lowered the tariffs on China and paused tariffs for 90 days, and it seemed the US admin. backtracked based on pressure from the markets.

Yes, its a very good idea to work with like-minded partners to achieve what is needed for economic security in the future, especially related to supply chains which are very vulnerable to all kind of mishaps which can affect all economies.

Unfortunately, at the present time, the US might not be a like-minded partner as it might take three or four years for the US to come to its senses again.

And maybe the same with China too, but China is a very different situation as its economy is having major challenges at the present time.

It's good that the EU and Japan are communicating their needs as they understand each side, which might not be the case with the US which only wants what it wants.

Its a little strange that the US and Japan don't have a free trade agreement with all the trade, both imports and exports between the two countries.

Hopefully Japan will stand its ground and not give in to pressure from the US on tariffs in the future. 

The America first banner is not going to work as the global trade system is too interconnected these days for any country to be its own island or isolated. 

The only thing that is going to happen is US consumers are going to pay the price with higher prices on everyday things, and its happening now.

Japan needs to plot its own course, but it might be a little too late as it's highly dependent on US consumer demand to buy Japanese products.

Unfortunately the EU economy is not the US economy in terms of economic growth or even consumer demand, and the Ukraine situation doesn't help much.

If the EU economy was robust or strong enough then maybe just maybe Japan could focus more on the EU and less on the US. 

And the same with China, but, again, the Chinese economy is very weak at this time and who knows exactly when its going to improve.

But only time will tell and negotiations between the US and many countries are still going on and hopefully each country will be able to hold its own and not given to the selfish demands of the US admin.

And yes, China sometimes doesn't play by the rules exactly, but again the US and Chinese economies are too interlinked for anything major to happen.

And the financial markets are the real moderators in this struggle and they will eventually decide what is good or not good.

Have a nice day!