Great Britain seals the first major trade deal with Japan after Brexit

Great Britain seals the first major trade deal with Japan after Brexit

The UK signed its first major post-Brexit trade deal after signing an agreement with Japan that will come into effect on January 1st.

Liz Truss, the British international trade minister, signed the agreement with the Japanese foreign minister Toshimitsu Motegi in Tokyo on Friday morning.

The pact, negotiated in just a few months last summer, is seen by the UK government as important evidence of its ability to secure new trade deals outside the EU.

Today we prove the naysayers are wrong with this groundbreaking British-shaped deal that was struck in record time

"It used to be said that an independent UK could not conclude major trade deals or that it would take years to complete," Ms Truss said in a joint press release with Mr Motegi.

"But today we are proving the naysayers are wrong with this groundbreaking British-shaped deal that was struck in record time."

The new agreement largely corresponds to the existing agreement between the EU and Japan, but contains an additional chapter on digital trade and it lacks the quotas for agricultural exports such as cheese, which Brussels took from Tokyo during years of talks.

Instead, the agreement allows the UK to use all of the EU's remaining agricultural quotas. UK officials are confident that there will be enough room in the quotas to maintain and increase UK food exports to Japan.

“We have maintained Japan's high level of access to UK markets. . . and for some products like railroad cars and auto parts we have improved access, ”said Motegi.

The UK was keen to get an early deal as it continues negotiations with Brussels on post-Brexit trade. Japan sees Great Britain as a strategic ally and creates the impetus for a swift deal.

Although the UK-Japan deal will allow continuity in trade between the two countries, Motegi said a UK-EU deal was still vital to Japanese business.

"To date, many Japanese companies have expanded their business into the UK as the gateway to continental Europe," said Motegi. "It is of the utmost importance that the UK-EU supply chain remains intact even after the UK withdraws."

Japanese automakers like Nissan and Toyota use parts from all over Europe in vehicles they assemble in the UK. Many of them are exported back to the EU. Mr Motegi said he had "high hopes" for a deal between London and Brussels.

Both sides see the deal as a potential stepping stone for Britain to join the Trans-Pacific Partnership, a regional pact that includes Australia, New Zealand and Canada, as well as Vietnam, Malaysia and other Pacific countries.

Negotiations on UK membership in the TPP would allow further trade liberalization between London and Tokyo, which could potentially go deeper than the EU-Japan deal.

"Japan welcomes the UK's interest in joining the TPP11 and will continue to provide the necessary support," said Motegi.

The agreement has yet to be ratified by the parliaments in Japan and the UK, but adoption is expected to be uncontested.

"With our newfound independence as an optimistic, outward-looking trading nation, the UK is again seizing the golden opportunity ahead," said Ms. Truss.