Japan FM urges clarity over Brexit

Japan’s foreign minister on Tuesday urged his visiting British counterpart to ensure clarity over Brexit amid signs Japanese businesses are growing increasingly nervous about Britain’s future outside the EU.

Taro Kono said it was “indispensable to ensure predictability and transparency as well as legal stability by setting a transition period” and told counterpart Jeremy Hunt he should “continue to listen to Japanese companies” on the issue.

“After Brexit, I hope for even closer economic relations between Japan and the United Kingdom,” said Kono.

Britain is due to leave the EU in March 2019, but the two sides have not agreed on the shape of their future relations.

They have however tentatively agreed to a transition period through 2020 to allow businesses and others to adjust to Brexit.

British Prime Minister Theresa May is scheduled to meet EU leaders this week to discuss the future relationship.

But European leaders may need an extra summit in November to clinch a Brexit deal and avert “a catastrophe” when Britain leaves in March, EU President Donald Tusk warned earlier Tuesday.

Kono’s remarks come just weeks after Panasonic decided to move its European headquarters from Britain to the Netherlands over concerns about potential tax issues related to Brexit.

Several Japanese firms including megabank MUFG, Nomura Holdings, Daiwa Securities and Sumitomo Mitsui Financial Group have also said they are planning to move their main EU bases out of London.

Britain is hoping to strike trade deals with its major partners including Japan following its exit from the bloc. Japanese companies have more than $60 billion invested in the country, according to recent statistics.

There are 879 Japanese companies employing 142,000 people in Britain, including carmakers Honda and Nissan.

With so much at stake, May has tried to reassure Japanese firms, visiting Tokyo in August last year and hosting top executives in London earlier this year.

However, like many of Britain’s closest partners, Japan has voiced concern about business relations post-Brexit.

Japan’s ambassador to London Koji Tsuruoka warned of the “high stakes” of Brexit, saying that no company could function if profits dry up in Britain.

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