Britain strikes first post-Brexit trade deal with Japan

KAZUHIRO NOGI / AFP

Britain struck its first post-Brexit trade deal with Japan on Friday, hailing the agreement as a 'historic moment', just as it is struggling to clinch a deal with its closest trading partners in the European Union.

Britain said the deal, which had been agreed in principle, meant 99 per cent of its exports to Japan would be tariff-free.

Digital and data provisions in the agreement went 'far beyond' those in the EU's trade deal with Japan, helping British fintech firms operating in the Asian country, it said.

Financial services firms, food producers, coat-makers and biscuit bakers - as well as cheese producers - would benefit from the agreement which represented an important step towards Britain joining the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) in the Asia-Pacific region.

Major Japanese investors in the UK such as Nissan and Hitachi would benefit from reduced tariffs on parts coming from Japan and streamlined regulatory procedures, the British trade department statement said.

Prime Minister Boris Johnson has said Brexit gives Britain the freedom to strike trade deals with other countries around the world.

Critics say such agreements are unlikely to replace exports lost to the EU if a deal cannot be struck with Brussels.

The EU has ordered Britain to scrap a plan to break their divorce treaty, but Johnson's government has refused, potentially sinking four years of Brexit talks.

Japan wanted to reach broad consensus with Britain on trade this week before a change in government in Tokyo which could have caused the negotiations to drift.

Japan's ruling party will choose a new leader next Monday to succeed Prime Minister Shinzo Abe, who is stepping down for health reasons. His successor will become the next premier and form a new cabinet.

The political changes could include replacing Japan's Foreign Minister Toshimitsu Motegi, who leads on trade negotiations. Motegi said on Friday the aim was to have the trade deal with Britain come into force in January.

Japan will submit the agreement to its parliament, which is expected to be convened later this year.

More from Business

Coming Up on Dubai Eye

  • Entertainment Extra

    1:00pm - 2:00pm

  • Afternoons with Helen Farmer

    2:00pm - 5:00pm

    Every weekday afternoon, Helen Farmer will help you to navigate the highs and lows of life in the UAE. Stay up to date with what’s happening and where to go.

BUSINESS BREAKFAST LATEST

On Dubai Eye

  • Flying Taxis

    It sounds like an episode of The Jetsons, but the sight of flying taxis whizzing around our cities could be much closer than you think.

  • Tough penalties for deliberate tax evasion

    The UAE has said that tougher penalties will come into force from 1st August for not keeping proper corporate tax records.