Japan’s Take on a No-Deal Brexit

0


In December the Prime Minister of Japan, Shinzo Abe, urged Theresa May to avoid the prospect of a no-deal Brexit scenario to ‘ensure transparency, predictability as well as legal stability’.

It’s no doubt that Japan remains hesitant on the terms of the UK’s withdrawal from the European Union. Abe’s rhetoric had been firm in the lead-up to May’s defeat in the Commons last January, even questionably stating that the prospect of a no-deal Brexit was against the wishes of the ‘whole world’. While Japan committed unyielding support for May’s deal, even suggesting that it could improve bilateral UK-Japan relations, this now remains uncertain in the run-up to March 29th.

But why does Japan, a nation 6,000 miles away from London’s financial hub, remain unduly devoted to a deal-warranted Brexit?

Japan remains one of the leading investors in the UK and has been using London as a gateway entry into the European markets. Prominent Japanese car firms such as Honda and Nissan, which have big stakes in the capital, have been reliant on the frictionless borders provided under the European Single Market’s ‘Four Freedoms’. Despite this, Tokyo is willing to accommodate any measures that will uphold the current liberal international order of honest free trade and cooperation. Back in October, Shinzo Abe stated that Japan would welcome the UK with open arms’ if it wanted to join the CPTPP (Comprehensive & Progressive Agreement for Trans-Pacific Partnership), a revised version of the TTP which President Trump initially withdrew from. Although the International Trade Minister, Liam Fox, tinkered with the idea of joining the new pact, the UK’s priority currently lies with its European partners.

Japan has encountered many international difficulties in the past two years but has shown its ability to remain flexible and resilient. Not only did Abe emerge as a key player in the revival of the TTP, but following President Trump’s instigation of a US-China trade war has sought greater diplomacy between Japan and China to establish further trade between the two nations. This comes amid omnipresent territorial disputes between the Senkaku/Diaoyu Islands and fierce historical antagonism which has fuelled nationalism in the region. It’s no surprise that Sino-Japanese relations are characterised as ‘politically cold, economically hot’.

What is most important for the UK, though, is the EU-Japan free-trade agreement (FTA) which has recently come into force. The FTA covers nearly a third of global GDP and will scrap between 97%-99% of import tariffs for the two blocs. If the UK leaves on no-deal terms, it could only reap the benefits of the FTA for 59 days.

How can Britain learn from the Japanese and recommit itself to the values of capitalism, free trade and cooperation?

Japan used to remain quiet on international affairs and free trade due to its core dependency on the US, but recent occurrences have changed this dynamic. When states show desperation, they strategise, negotiate and act. A core element of this demands good leadership, and this prominently comes about through national unity.

There are no easy answers for Brexit, but persistent fragmentation only exacerbates the lack of progress we have been observing for the past two-and-a-half years. Britain must analyse the methods Japan has been undertaking for the past two years and stress its firm commitment to upholding the international liberal order if it wants to succeed in global affairs. Japan’s ability to further trade with China, help revive the TTP, and sign an FTA with the EU in only two years should inspire optimism for the UK – which is why we should learn from them.

avatar

Third year IR student with keen interests in East Asian regional stability, Chinese politics, Japanese politics, and war and conflict studies.

Leave A Reply