While negotiations with the European Union on Brexit seem more stalled than ever, London welcomed the free trade agreement signed with Tokyo on Friday 11 September. A “historic” success, really? United Kingdom: “major” trade agreement with Japan.
United Kingdom: “major” trade agreement with Japan
If nothing goes any more between London and Brussels on the Brexit negotiations, the United Kingdom has just scored a significant point by signing, on Friday September 11, a major trade agreement with Japan, the first of such magnitude since the divorce from the European Union ratified on January 31.
“We have regained control of our trade policy and we will continue to prosper as a trading nation outside the EU,” British Prime Minister Boris Johnson immediately trumpeted on social networks, while his Minister for International Trade , Liz Truss, spoke of “historic moment”.
Good economic news
“We will have to look closely at the nature of this agreement and assess its real depth, but it is true that from an economic point of view, this signing is rather good news for the United Kingdom”, recognizes Aurélien Antoine, professor and researcher at the he University of Lyon and director of the Brexit Observatory.
The free trade agreement, which will come into force on January 1, should allow tariffs to be avoided on certain exports to Japan, in particular agri-food products. According to the Department for International Trade, it is expected to increase trade between the two countries by 15 billion pounds (16 billion euros), boosting a struggling British economy due to the coronavirus crisis.
A more than mixed commercial results
It was therefore essential for London to structure, before this deadline, its link with Japan, its fourth non-European partner, with 32 billion pounds of trade carried out last year (34.6 billion euros).
“On the political level, the gain is more mixed,” said Aurélien Antoine. “This may strengthen London’s position as tensions with Brussels have escalated with the recent challenge to the divorce agreement,” he said. But, internally, the British have other things to do with the economic and social shock caused by the pandemic. Especially since the provisional record of the government’s trade policy remains more than mixed. ”
With Brexit, the United Kingdom will exit the single European market on December 31, which represents almost half of its foreign trade. However, in the absence of an agreement by this date, economic relations between the two groups will be governed by the rules of the World Trade Organization (WTO), which means the return of border formalities and the application of customs tariffs.