Britain and Japan signed a post-Brexit trade agreement, the first of its kind after the Brexit on 31 January 2020.
Previously, Britain cut off the ties with the European Union (EU) to become separate from the political and economic institutions of the European Nations. According to the reports, the Brexit changes in trading and migration will commence in January 2021.
However, the latest post-Brexit trade agreement between Britain and Japan revealed a bilateral agreement where both the countries will remove trade tariffs for mutual benefits. BBC reported that Japan will be tariff-free for British exports after the new deal.
Japanese cars, on the other hand, will be tariff-free in Britain from 2026. The new agreement has been quoted as a great achievement in Britain.
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Britain Cabinet is promoting it as “a ground-breaking, British-shaped deal,” according to UK International Trade Secretary Liz Truss. However, some of the experts believe that it will not recover the lost GDP due to the Brexit.
Some study suggests that Britain will gain only 0.07% GDP from the Post-Brexit Trade Agreement with Japan. The trade agreement was reached in September where both the countries are expecting a £15 billion boost in trade.
British media claimed that the new deal will take effect on January 2021. Dr. Minako Morita-Jaeger thinks that Japan accounted for 14% of the global investments in 2018.
Japan also had similar deals with the EU before but the new agreement with the UK might support more digital trades, she added.
“Given that Japanese FDI (Foreign Direct Investment) has been playing an important role in the UK economy and retaining its existing investment in post-Brexit is crucial, the UK government should have shown a strong commitment to Japanese investment by including a comprehensive investment chapter encompassing investment protection and dispute settlement.”
– Dr Minako Morita-Jaeger, international trade policy consultant and fellow of the UK Trade Policy Observatory at the University of Sussex