You are here
Japan's fear that PM May's Brexit plan will be shot down is real
JAPAN has a lot riding on Brexit. That is something that Prime Minister Shinzo Abe is sure to drill home to his British counterpart Theresa May when he flies over to see her in person days before Parliament votes on her divorce plan.
Few countries are as worried about the prospect of a disorderly exit, given the degree of foreign investment in the UK, from carmakers Nissan Motor Co to tech conglomerate SoftBank Group Corp and fashion brand Uniqlo.
The UK is their foothold in Europe, and Mrs May's deal may be the only thing guarding them from the chaos of a no-deal outcome. That is why Mr Abe will probably speak out in favour of Mrs May's proposal, according to a foreign ministry official.
A public show of support from Mr Abe would demonstrate just how concerned Japan is that the UK is flirting with disaster and that its top companies could get caught in the crossfire. According to the official, who asked not to be identified, Mr Abe will focus on the negative effects of Brexit and remind Mrs May that disruption to Japanese businesses must be kept to a minimum.
"World attention is focused on the UK's exit from the EU," Mr Abe told reporters before leaving Tokyo for a visit to the UK and the Netherlands, in comments broadcast by television network TBS. "Precisely because of this problem, it is very meaningful for me to visit the UK and exchange opinions. I want to properly convey Japan's thinking."
Mr Abe and Mrs May will have a lunch together after he arrives on Jan 10, followed by a news conference and a business reception. This is his second visit to the UK since Mrs May took office and his seventh meeting with her.
He will bring another concrete gesture of support in the form of Japan's removal of its 23-year-old ban on imports of UK beef, which was imposed due to concerns over Bovine Spongiform Encephalopathy or mad cow disease. Beef from cattle aged under 30 months will be allowed into Japan's market for the first time since 1996.
On a visit to London weeks ahead of the 2016 referendum, Mr Abe offered vocal support for then-premier David Cameron's campaign to remain in the EU. Months later, Japan issued an open letter to the UK urging predictability in the process of Brexit negotiations on behalf of the roughly 1,000 Japanese companies, including car manufacturers that account for half of the UK's production.
Less than three months before the UK leaves the European Union on March 31, Mrs May's deal appears to have little chance of passing given the tough parliamentary arithmetic. For many companies, January was the cut-off after which contingency plans went into effect.
Instead Britain is talking up no-deal preparations - and even those are not going as planned. For example, a practice run for a potential traffic jam caused by delays at the port of Dover turned into a farcical flop when not enough trucks showed to complete the drill. None of this will be reassuring to investors, especially Japanese ones who are among the most exposed.
When Boris Johnson visited Japan as foreign secretary in 2017, he shook hands with a robot and promised a "fantastic, all-singing and all-dancing, UK-Japan free trade agreement".
Last year, he resigned and is now one of the fiercest critics of Mrs May's plan, calling it a "suicide vest" and even embracing "no deal" as something voters want.
This turn of events will have done little to put Japanese executives at ease. BLOOMBERG