The U.K. and Japan are close to agreeing on a post-Brexit trade accord, a deal that would replace the free-trade agreement Britain enjoys through its membership of the European Union and avoid the introduction of tariffs next year.
An agreement in principle is expected in coming weeks, according to a person familiar with the U.K. side of the talks, who asked not to be identified because the negotiations are private. The discussions haven’t yet concluded, and some issues still need to be resolved, the person added.
Rolling over a deal with the world’s third-largest economy has been a post-Brexit priority for the U.K., which is trying to preserve and build upon the benefits of the EU-Japan deal signed in 2018. The U.K. will no longer be party to that agreement when the Brexit transition period finishes at the year-end.
A deal would also be a boost to U.K. Prime Minister Boris Johnson, who has argued that the ability to sign free-trade agreements with other countries tailored to Britain’s interests is a key benefit of Brexit. So far, negotiations over an accord with the EU have been deadlocked.
Trade between Britain and Japan was valued at more than £39 billion ($51 billion) last year, and Japan is the U.K.’s eleventh-largest export market globally. When talks started in June, U.K. International Trade Secretary Liz Truss said she wanted to go beyond the EU’s existing deal and bolster trade in digital services and data.
“Both sides are committed to an ambitious timeline to secure a deal that will enter into force by the end of 2020 if at all possible,” the U.K.’s Department for International Trade said in a statement. “Our priority is to maintain and enhance the trading relationship between our two countries.”