The government has begun arrangements to resume negotiations on a free trade agreement (FTA) with the Gulf Cooperation Council (GCC) -- a group of six Persian Gulf countries -- by the end of 2024, according to government sources.
Prime Minister Fumio Kishida is expected to reach an agreement Sunday with GCC Secretary General Jasem Al-Budaiwi as part of his visit to Saudi Arabia, the sources said.
The GCC, which is headquartered in Saudi Arabia, comprises Saudi Arabia, the United Arab Emirates (UAE), Qatar, Bahrain, Oman and Kuwait.
Japan began FTA-related negotiations with the GCC in 2006, but talks were suspended in 2009 after the two sides failed to reach agreement on such issues as tariff eliminations.
By resuming negotiations and deepening trade relations with the Gulf states, Japan hopes to strengthen its energy security.
In 2020, Japan imported goods -- primarily crude oil -- worth about 5.4 trillion yen from GCC nations, while exporting cars and machinery parts worth about 2.1 trillion yen to those countries.
Japan does not impose tariffs on goods imported from the GCC, but GCC countries impose a 5% tariff on most products imported from Japan.
Consequently, the Japan Business Federation (Keidanren) and other organizations have urged the government to resume FTA negotiations with the GCC in hopes an agreement will result in the elimination or reduction of tariffs.
Given the large number of wealthy people in GCC countries, some within the Japanese government expect the FTA to lead to an increase in exports of manufactured goods, in addition to agricultural, forestry and fishery products.
With oil prices soaring following Russia's invasion of Ukraine, there have been noticeable moves within the international community to strengthen trade ties with Middle Eastern countries with an eye on stabilizing energy supplies.
China and South Korea have already resumed FTA negotiations with the GCC, putting Japan under pressure to accelerate negotiations.
Kishida is scheduled to visit the UAE and Qatar by Wednesday.
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