Japan to keep tariffs on farm imports under FTA with Singapore

Asian Economic News, August 20, 2001

TOKYO, Aug. 15 Kyodo

Singapore would remove all tariffs on Japanese imports while Japan would maintain ones on agricultural and fishery imports from Singapore in a proposed bilateral trade deal, according to a draft of the agreement obtained by Kyodo News on Wednesday.

Japan would remove tariffs on naphtha, plastics and petrochemical products from Singapore by stages but not at one stroke, the draft says.

The two countries are expected to approve the trade cooperation pact, Japan's first free trade agreement (FTA) with a foreign country, in early September and put it into effect by summer in 2002.

The principal agricultural and marine products Japan imports from Singapore are goldfish, tuna and cocoa powder. Although they account for only 4% of the value of imports from Singapore, Tokyo would maintain tariffs on them as lawmakers representing agricultural interests and farm ministry officials are strongly opposed to their removal.

However, the maintenance of tariffs on farm and fishery imports is expected to act as a drag on Japan's FTA negotiations with countries such as Mexico and South Korea.

As World Trade Organization rules require the removal of all tariffs in principle when two countries conclude an FTA, Japan is expected to work for the repeal of remaining tariffs under its accord with Singapore within 10 to 20 years.

While some 85% of the value of all imports from Singapore to Japan are currently tariff-free, the agreement would raise the ratio to more than 90%.

Singapore currently levies tariffs only on alcoholic beverages and tobacco products from Japan.