The UK-Japan Comprehensive Economic Partnership Agreement was agreed in principle by International Trade Secretary, the Rt Hon Liz Truss MP and Japan Foreign Minister on a video call this morning (Friday 11 September). It is the UK’s first major trade deal outside the EU.
Scottish knitwear and Borders textiles firms are set to benefit from tariff-free access, making it easier and cheaper for them to sell to the Japanese market.
Scottish malt producers will also benefit from more generous market access. Japan has guaranteed market access for UK malt exports under an existing quota which is more generous and easier to access than the EU quota. The UK is the second biggest exporter of malt to Japan, exporting £37m there each year.
For Borders farmers, the deal sees tariffs fall on pork, beef, salmon and a range of other agricultural exports. In addition, Scotch beef, lamb and Teviotdale cheese are among 15 iconic Scottish products that could be protected in Japan for the first time as part of the UK-Japan trade deal. Scotch whisky will also continue to benefit.
The deal secures additional benefits beyond the EU-Japan trade deal, including a way for Scottish products to be officially recognised. By increasing geographical indications (GIs) from just seven under the terms of the EU-Japan deal to potentially over 70 under the UK-Japan agreement, this would lead to improved recognition of key UK brands in the Japanese market.
A deal with Japan could increase UK trade by £15.2 billion, giving a £1.5 billion boost to the economy and increasing UK workers’ wages by £800 million in the long run. This will benefit the 574 Scottish businesses that exported to Japan last year and help even more businesses to sell their goods to Japan for the first time.
Other key benefits of the UK-Japan Comprehensive Economic Partnership Agreement include cutting-edge digital and data provisions that go far beyond the EU-Japan deal, new protections for UK creative industries and improved mobility for business people.
John Lamont MP said: “This significant trade deal with Japan will be a real boost for businesses here in the Scottish Borders and across Scotland.
“Scottish businesses exported more than £503 million worth of goods to Japan last year, and this is only set to increase thanks to this deal.
“I am delighted that Borders textiles will benefit from tariff-free access to the Japanese market while malt producers will gain much more generous and easy access. Borders businesses are certainly set to see an export boost from this agreement.
“On top of this, reduced agricultural tariffs will be important for our local farmers and the wider rural economy. Japan is undoubtedly a key growth market for these businesses.
“This is a fantastic deal for Scotland and the UK, securing additional benefits beyond the EU-Japan trade deal that will help to create jobs and drive economic growth across the nation.”
Secretary of State for International Trade, Liz Truss MP said: “This is a historic moment for the UK and Japan. This is our first major post-Brexit trade deal and it goes far beyond the existing EU deal by securing new wins for British businesses including in our great manufacturing, food and drink, and tech industries.
“From our Scotch beef and lamb farmers to our Scottish wild salmon and Orkney Scottish island cheddar, this deal will create new opportunities for people throughout the whole of the UK and help level up our country.
“Strategically, the deal is an important step towards joining the Trans-Pacific Partnership and placing Britain at the centre of a network of modern free trade agreements with like-minded friends and allies.”