London and Tokyo signed a major free trade agreement on Friday, which is expected to increase commerce between the two countries by an estimated €16.8 billion ($19.9 billion).
The new deal will take effect when the UK formally leaves the European Union at the start of 2021, and will make it easier for British companies to operate in Japan.
Appearing with Japanese Foreign Minister Toshimitsu Motegi, British International Trade Secretary Liz Truss called the agreement a “landmark” as the first major trade deal for Britain as an independent trading nation.
British Secretary of State for International Trade Elizabeth Truss (L) and Japanese Foreign Minister Toshimitsu Motegi exchange documents during a signing ceremony for economic partnership between Japan and Britain in Tokyo on October 23, 2020
Motegi said the bilateral trade deal ensures continuity from the preceding European agreement, while adding new areas for cooperation such as e-commerce and financial services.
Financial services make up Britain’s biggest export to Japan, currently standing at 28 percent. English sparkling wine, made-in-Britain coats and shoes, Stilton cheese, as well as pork and biscuits from Britain, will become cheaper in Japan.
Tariffs on Japanese cars will be removed gradually but won’t be eliminated until 2026, the same as the terms of the deal Japan has with the EU. Tokyo’s existing free trade agreement with the European Union includes the UK only until the end of this year, as it exits the EU.
According to the Japanese Foreign Ministry, the nation already exports about 1.5 trillion yen ($14 billion) of goods to Britain, mostly automobiles, auto parts and other machinery, while importing nearly one trillion yen ($9.5 billion) worth of British goods, including pharmaceuticals, medical products and cars.
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