UK-Japan sign first ‘historic’ independent post-Brexit trade agreement

On September 10, the UK government announced in a press release that it has secured an independent trade deal with Japan, which is a breakthrough, and UK’s first major trade deal post Brexit. As an independent trading nation, the UK will now boost the trade relations with Japan by an estimated £15.2 billion, the UK government said. In a video conference held on September 10 morning, the two leaders, International Trade Secretary Liz Truss and Japan’s Foreign Minister Motegi Toshimitsu agreed to take the UK-Japan Comprehensive Economic Partnership Agreement forward. 

“The deal is tailored to the UK economy and secures additional benefits beyond the EU-Japan trade deal, giving UK companies exporting to Japan a competitive advantage in a number of areas,” the Boris Johnson administration said in a release issued by the Downing Street. “It will help to create jobs and drive economic growth throughout the whole of the UK,” it added. Further, the United Kingdom called the trade deal a Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). 

“This deal can make a vital contribution towards the UK’s economic recovery and our industry is ready to deliver for every community across the UK,” Dominic Goudie, Head of International Trade said. 

The UK acknowledged the deal, saying, that it will give the country resilience and diversity with respect to supply chains in the Asia-Pacific region. Further, the government boasted the tariff-free trade on 99 percent of its exports to Japan, moving forward. While Japan will deliver a whopping £1.5 billion worth boost to the UK’s economy, the UK government promised that it would steep the UK workers’ wages by an estimated £800 million. 

“This is a historic moment for the UK and Japan as our first major post-Brexit trade deal. The agreement was negotiated in record time and in challenging circumstances,” International Trade Secretary Liz Truss said.

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She added, “The deal secures new wins for British businesses that go far beyond the existing EU deal.” Truss said that the trade deal was, strategically “an important step towards joining the Trans-Pacific Partnership and placing Britain at the center of a network of modern free trade agreements with like-minded friends and allies.”Japan-UK deal trade includes cutting-edge digital & data provisions for the free flow of data with high standards of personal data protection and net neutrality, which bans the data localization, prohibiting the UK government to impose extra servers cost in Japan. The deal also improves market access for the UK financial services seeking licenses to operate in Japan.

Director-General of the Confederation of British Industry, Carolyn Fairbairn said, “The signing of the UK-Japan trade deal is a breakthrough moment. It will be welcomed by businesses across the country.” 

Regulatory friction slashed

The dialogue between Her Majesty’s Treasury, UK financial regulators, and the Japanese FSA led to the reduction of regulatory friction, which was previously impossible for the UK under the EU. The deal further imposes tariff-free access for more UK goods, liberal Rules of Origin, and strong tariff reductions. It also seeks improved mobility and flexibility for Japanese and British companies.

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