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London and Tokyo both confirmed the historic Brexit deal had been agreed in principle this morning. Liz Truss, the UK trade minister, has celebrated the news and highlighted the 10 key benefits of the free trade agreement, which is estimated to increase trade by £15.2billion.
Ms Truss shared the 10 reasons on her Twitter account, which range from new protections on UK goods to improved mobility for businesses.
She highlights how the new deal is more beneficial than existing arrangements with the EU.
Firstly, the trade deal will provide cutting-edge digital and data provisions, which will help UK fintech firms operating in Japan to innovate and grow.
The trade minister pointed out the new stance goes beyond the deal the EU has with Japan, therefore making it easier for UK technology firms to export to Japan.
The new trade agreement will also improve market access for UK financial services.
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The Department for Trade (DoT) said: “The deal creates an annual dialogue between Her Majesty’s Treasury, UK financial regulators, and the Japanese FSA that will explore ways to further reduce regulatory friction – something that would be impossible were the UK still in the UK.
“Financial services are out biggest export to Japan, account for 28 percent of all UK exports.”
The deal also provides for tariff-free access for more UK goods, allowing producers of coats, knitwear and biscuits to source inputs from around the world for the exports to Japan.
This will make it easier and cheaper for them to sell on the Japanese market.
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Iconic UK goods, such as Welsh lamb, Yorkshire Wensleydale and English sparkling wine will also be given greater protections.
The new deal increases the number of geographically protected goods from seven to over 70, when compared to the existing EU-Japan deal.
The fifth benefit is that UK creative industries will be given new protections.
Trade advisers have also secured greater mobility for business people, making it easier for Japanese and British companies to move talent into each country.
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The DoT said: “This includes commitments that go beyond the EU-Japan deal, for investors, spouses and dependents, and a wider range of intra-company transfers.”
The deal is also groundbreaking in that it paves the way for UK accession to the Trans-Pacific Partnership (CPTPP), which would open up 11 key pacific markets for exporters, reducing tariffs for UK business.
Another benefit is that the agreement supports UK car and rail manufacturing through reduced tariffs on parts coming from Japan.
This will provide greater benefits for companies such as Nissan and Hitachi.
The UK-Japan trade deal will also provide more generous market access for malt producers, which is significant as the UK is the second biggest exporter of malt to Japan, with UK producers exporting £37million there each year.
Finally, the agreement provides strong tariff reductions for pork, salmon and other agricultural exports.
The DoT said: “We will continue to benefit from access to the low tariffs fro key food and drink products covered by quotas, such as Stilton, cheese, tea extracts and bread mixes.
“This forms a pathway to further market access under CPTPP, which has been committed to by Japan as part of our agreement.”
The agreement between the UK-Japan marks the first post-Brexit trade deal.
Britain said the deal, which had been agreed in principle, meant 99 percent of its exports to Japan would be tariff-free.
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