LOS CABOS, Mexico – Prime Minister Junichiro Koizumi and Mexican President Vicente Fox agreed Sunday to launch negotiations next month to forge a bilateral free-trade agreement.
The two countries will hold their first round of FTA talks in Tokyo in November, hoping to conclude them within a year of their start, according to a joint statement issued after the Koizumi-Fox meeting.
At a joint news conference, Koizumi and Fox said they hope the two countries will conclude the FTA negotiations by the time the Mexican president visits Japan in fall 2003.
Koizumi and Fox declared the start of FTA negotiations after more than a year of joint feasibility studies by a group of government, business and academic representatives from the two countries.
The two leaders “confirmed the importance of enhancing the economic partnership between the two countries in order to strengthen the bilateral economic relations and revitalize the economies,” the statement said.
An FTA with Mexico would be Japan’s second bilateral FTA following a deal signed with Singapore in January.
But unlike the pact with Singapore, concluding an FTA with Mexico involves trade in farm products, a politically sensitive area for Japan. Singapore’s exports are primarily high-tech in nature.
At the news conference, Fox said it is necessary for the agricultural area to be included in the final results of the FTA negotiations.
“Agriculture is also sensitive for Mexico,” Fox said. “Mexican farm products will not become a threat to Japan.”
Koizumi was vague in regards to agriculture, saying, “An agreement should be beneficial both for Japan and Mexico.”
Mexico has been aggressive in negotiating FTAs around the world. Its FTAs include the 1994 North American Free Trade Agreement with Canada and the United States, as well as an FTA signed with the European Union in 2000.
Exports by U.S. and European companies are subject to zero tariffs, but Japanese products face average tariffs of 16 percent because of the lack of a bilateral FTA.
This has prompted the Japanese government to start talks on an FTA with Mexico despite the existence of the agricultural trade issue.
Koizumi and Fox met in Los Cabos, Mexico, after the annual summit of the Asia-Pacific Economic Cooperation forum.