Monday, February 26

UK and Japan sign £15bn trade deal



The UK and Japan have signed a free trade agreement at a ceremony in Tokyo, hours before negotiations on a post-Brexit deal with the European Union are due to resume.

The UK-Japan Comprehensive Economic Partnership Agreement (CEPA), which was agreed in principle last month, marks Britain’s first deal with a major economy since Brexit.

The government claims the agreement will boost trade with Japan by £15.2bn over the next 15 years and UK businesses will enjoy tariff-free trade on 99% of exports to the country.

International Trade Secretary Liz Truss had struck the deal with Japan’s foreign minister Toshimitsu Motegi on a video call on 11 September.

After the ceremony, Ms Truss said: “How fitting it is to be in the land of the rising sun to welcome in the dawn of a new era of free trade.” She added it would “pave the way” towards UK membership of the wider Trans-Pacific Partnership.

Ms Truss had earlier hailed the importance of the agreement.

At its heart, this deal is about creating opportunity and prosperity for all parts of our United Kingdom and driving the economic growth we need to overcome the challenges of coronavirus, she said.

The government said the deal would support UK car and rail manufacturing jobs, lower tariffs on products like pork, beef and salmon, and British consumers would get access to cheaper, high-quality Japanese goods.

Dame Carolyn Fairbairn, CBI director general, said: The signing of the UK’s first independent trade agreement is a milestone for our economy and will be welcomed by businesses in many sectors.

This deal has the potential to support jobs across the country through lifting British farming exports and supporting our manufacturing and services sectors. Consumers will also benefit through greater choice.

Government analysis found that a deal with Japan would boost the UK’s GDP by around 0.07% over 15 years and increase UK workers’ wages by £800m in the long run.

It is due to publish a full report on the agreement, including any significant differences or enhancements.

Brexit talks between Britain and the European Union are set to resume after stalling last week when Downing Street insisted there was no point in resuming discussions unless there was a change in stance from the EU.

The EU’s chief negotiator Michel Barnier has welcomed the reopening of talks and told reporters in London that he wanted to make every day count.

Allie Renison, senior policy advisor at the Institute of Directors, said: “This standalone trade deal [with Japan] could be the cherry on top if the UK manages to land an EU deal as we exit the transition period.