UK and Japan agree £18bn investment deal
The UK and Japan have signed a multi-billion pound investment deal with Japanese firms investing over £9bn in UK infrastructure and financial services, and up to £9bn in offshore wind, creating tens of thousands of jobs.
UK Prime Minister Sir Keir Starmer and Japanese Prime Minister Sanae Takaichi have agreed a multi-billion pound investment deal in London, which Starmer said would build a "new era of co-operation" between the two nations.
According to Downing Street, Japanese firms will spend more than £9bn on UK infrastructure and financial services, and up to £9bn on UK offshore wind projects, creating tens of thousands of jobs. The deal comes as the UK economy struggles to grow, with experts predicting the US-Israel war with Iran will hit the UK particularly hard.
It is not clear how much of the investment represents new money or previously announced plans. Starmer and Takaichi met Japanese business leaders at Downing Street on Sunday, with Starmer describing the talks as "very productive".
Separately, the two countries reaffirmed their commitment to the GCAP fighter jet programme being developed alongside Italy. It was also announced that Rolls-Royce will work with Japan's Atomic Energy Agency to develop next-generation nuclear technologies, and a technology agreement will link UK research and development and software expertise with Japanese manufacturing.
Speaking through a translator, Japan's prime minister said the UK is "an extremely important partner". Mitsubishi Estate, Mitsui Fudosan, and Nomura Real Estate were among the Japanese firms that Downing Street said had agreed to spend billions over the next five years on infrastructure and real estate projects.
The Conservative shadow business and trade secretary Andrew Griffith welcomed "any deal that brings investment" to the UK, but added that Labour's "tax hikes and employer red tape are doing huge damage, destroying jobs and putting more and more people onto welfare".
Though Downing Street says the deal will boost jobs and long-term growth, experts expect economic pain in the near term. The UK economy grew by 0.6% in the first three months of the year, the fastest growth of any G7 economy, but analysts think growth will be sluggish in the months ahead. However, the IMF expects the UK to recover and become the fastest growing European economy in the G7 next year, albeit at a slightly slower rate of 1.3%.
