- accelerated timeline agreed at the G7 summit in Japan today
- agreement will be worth £5 billion a year to the UK economy – £200 to each British household
The UK economy is set to be given a £5 billion a year boost after the EU and Japan committed to political agreement on a free trade deal as early as possible in 2016.
The EU-Japan Free Trade Agreement (FTA) will be worth the equivalent of £200 for every household, and could be signed as early as autumn.
Prime Minister David Cameron made progress on the deal one of his key objectives for this year’s G7 summit, raising it at a UK-led session on trade this morning before speaking at the special late afternoon event at which the timeline was agreed.
In a joint statement following the meeting the Prime Minister and leaders from the EU, Japan, France, Germany and Italy said that the deal will “promote strong, sustainable and balanced growth”, including the creation of more jobs.
Both sides will now strive to narrow the gaps over the summer before finalising key elements such as auto and agricultural tariffs and government procurement over the autumn.
The UK has played an important role in driving forward the negotiations; pushing for the EU-Japan event to happen at the G7 and making discussions on the deal a central part of Japanese Prime Minister Shinzo Abe’s visit to the UK on 5 and 6 May.
Speaking from the G7, Prime Minister David Cameron said:
This agreement underlines once again why we are stronger, safer and better off in a reformed EU. As Prime Minister Abe said when visiting the UK, Japan’s priority is negotiating with large trade blocs – not individual states in Europe. And this is something we hear time and again from foreign leaders.
Not only will UK households lose out to the tune of £4,300 a year if we vote to leave, but we will be turning our backs on global trade deals which underpin our security and prosperity.
Negotiations on the Japan-EU FTA have been underway since March 2013 with the most recent round taking place in Tokyo in April.
The deal will mean the elimination of the vast majority of trade tariffs and boost imports and exports in key areas such as agriculture, car manufacturing and clothing.
It will also build on what is already a strong bilateral relationship between Japan and the UK. Britain benefits more from Japanese investment than any other country in the world apart from the US and by the end of 2014 the total value of Japanese investment in the UK was £38 billion.