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Japan has agreed to extend existing trade terms for the duration of Britain’s planned transition period with the EU — but this will not apply if the UK fails to strike a deal with Brussels. I
t is now too late for the Japanese Diet to ratify any agreement before Brexit is scheduled to take place on March 29. There is also a wide gap in expectations about a trade accord, which would apply either in the case of no-deal Brexit or at the end of Britain’s planned transition period, which is due to end in December 2020.
Tokyo is confident that it can secure better terms from the UK than it did in negotiations with the much larger EU, and is not willing to duplicate the existing treaty precisely in either a bilateral deal or in talks for the UK to join the Trans-Pacific Partnership group.
“The new agreement is not just a copy-and-paste of the existing treaty,” said one Japanese official briefed on the talks. “The tariffs, rules and quotas need to be negotiated separately.”
The lack of progress on a future bilateral deal — a goal set out by prime minister Theresa May on a visit to Japan in August 2017 — highlights the UK’s broader struggle to roll over existing EU trade deals, let alone secure anything better. [...]
Japanese prime minister Shinzo Abe is keen to help Mrs May, publicly supporting her exit deal with Brussels, and talking up the potential for Britain to join the TPP. Ultimately, Japan could make a political decision to offer more generous terms.
But in preliminary talks, Tokyo’s veteran trade negotiators have been under instructions to extract every advantage possible. Progress has been particularly slow since many of their UK counterparts have been diverted to work on preparations for a no-deal Brexit.
Full article on Financial Times (subscription required)