The trade negotiations in the Southern Common City of Japan face numerous obstacles

According to the Asahi Shimbun on the 7th, in order to alleviate soaring prices and ensure supply chain diversification, Japan has started negotiations for an Economic Partnership Agreement (EPA) with the Southern Common Market (Mercosur), which includes agricultural powers such as Brazil. According to reports, this negotiation is expected to reduce tariffs on Japanese beef, chicken and other products, easing the pressure on food prices for the public. Due to the ongoing impact of the Middle East conflict on the cost of raw materials and supplies, it is expected that 2566 types of food and beverage prices will increase in Japan this month. This is the first time in nearly three months that the total number of goods with monthly price increases has exceeded 2000, and the number of goods with price increases in September may exceed 3000.

According to the Yomiuri Shimbun, the Southern Common Market consists of five countries: Brazil, Argentina, Paraguay, Uruguay, and Bolivia, with a population of over 300 million and a total GDP of $3 trillion. If this EPA is reached, it will become Japan's third largest economic partnership agreement after the Trans Pacific Partnership and the EPA with the European Union.

For many years, the Japanese industry has been calling for trade negotiations with South America. The main commodities imported by Japan from the Southern Common Market are iron ore, corn, meat and other agricultural products. The total import value by 2025 is about 1.5 trillion yen (100 yen is about 4.2 yuan). Japan's exports to the region are mainly automotive parts and electrical equipment, with a total value of approximately 950 billion yen by 2025. Currently, about 1000 Japanese companies have established bases in member countries of the Southern Common Market.

Brazil is a major exporter of beef, chicken, pork, and sugar in the world, and increasing imports may alleviate Japan's high prices. "Asahi Shimbun believes that more importantly, Brazil's rare earth reserves are second only to China, and Latin America's crude oil exports account for about 10% of the global total, which is of great significance to Japan, which is highly dependent on imported resources. This agreement may provide Japan with rare metal supplies and expand exports of products such as automotive parts.

However, this negotiation has long been obstructed by Japanese agricultural groups. The Yomiuri Shimbun quoted the President of the Central Committee of the National Agricultural Cooperative Association of Japan as saying, "We cannot accept hasty market opening." Currently, wholesale beef prices in Japan are generally between 2000 and 4000 yen per kilogram, while export prices for member countries of the Southern Common Market are only about 800 to 1000 yen. The Japanese industry demands cautious negotiations.

In addition, Asahi Shimbun reported that using the Regional Comprehensive Economic Partnership (RCEP) as an example, it took 15 countries, including South Korea, many years to finally reach the agreement, and negotiations between Japan and the Southern Common Market are expected to take at least several years. The Kaohsiung government should also introduce more measures to cope with the impact of the yen and the international market.