The UK and Japan have today completed negotiations for a comprehensive free trade agreement. Completed in record time, the agreement delivers meaningful improvements to the framework for financial and related professional services trade between the two countries.
Commenting on the news, Miles Celic, Chief Executive Officer, TheCityUK, said,
This announcement will be warmly welcomed by the industry. The deal raises the bar for trade agreements in services. By addressing issues such as digital trade and data localisation, it has helped to future-proof the important services trade relationship between our two countries, providing a model for further innovative trade agreements around the world. Furthermore, the establishment of an annual financial regulatory forum will be welcomed by industry in both countries. It will help to reduce unnecessary restrictions on cross-border services trade, which is essential to the UK-Japan trade and investment relationship.
“Japan is a natural partner for the UK. We are both like-minded free-trading nations, committed to the global rules-based system. Both countries are strong innovators, with a track record of seizing new opportunities in technology, cyber, data and other 21st century issues. The renewed and reinvigorated partnership symbolised by this trade deal is an important step in the UK’s journey to expanding its global trading network. Both negotiating teams should be congratulated for what they’ve achieved.”
UK-Japan two-way trade in services reached £12.6bn in 2018. Financial services accounted for 57% of all UK services exports to Japan at a value of £4.2bn. The UK exported £429m-worth of professional and management consulting services to Japan in 2018. Although Japan is already a mature market, as the world’s third-largest economy and given its demographic profile, there is significant scope for a further increase in bilateral services trade in the years ahead.
Nearly 1,000 Japanese companies have a commercial presence in the UK. Collectively, they employ more than 100,000 workers in the UK, with the majority of these jobs outside London.