The UK has secured a free trade agreement with Japan, which is the UK’s first major trade deal as an independent trading nation and will increase trade with Japan by an estimated £15.2 billion.
The UK-Japan Comprehensive Economic Partnership Agreement was agreed in principle by International Trade Secretary Liz Truss and Japan’s Foreign Minister Motegi Toshimitsu on a video call this morning (Friday 11 September).
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. It will help to create jobs and drive economic growth throughout the whole of the UK.
The deal is also an important step towards joining the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). This will give UK businesses a gateway to the Asia-Pacific region and help to increase the resilience and diversity of our supply chains.
UK businesses will benefit from tariff-free trade on 99% of exports to Japan. Government analysis shows that a deal with Japan will deliver a £1.5 billion boost to the UK economy and increase UK workers’ wages by £800 million in the long run.
Source: UK Government
The BDP breakdown:
This is the first UK trade agreement that they have signed since announcing Brexit. This FTA provides two major economies zero duties on 99% of goods exchanges between them while they each have protected their auto industries. Both countries will benefit from this new agreement with more and new market access for goods that previously may have had a higher tariff rate.
The deal contains the new digital provisions that all new FTAs must develop as well as several other conditions that new markets need.
Will this trade deal mark an important first step for future trade UK trade deals with many other Asian countries?