Japan warns UK PM rivals: no-deal Brexit could end our investment honeymoon

Japan on Thursday cautioned the two candidates vying to replace Prime Minister Theresa May that a no-deal Brexit would be so disruptive for many companies that Japanese capital’s 35-year honeymoon with Britain could end.

In an appeal to both Boris Johnson and Jeremy Hunt, Foreign Minister Taro Kono said Tokyo did not want a no-deal Brexit, that some companies were already moving out and that more investment could go.

“I know Boris and I know Jeremy both of them pretty well,” Kono told Reuters in Osaka where a G20 summit begins on Friday.

“I have communicated with them that Japan wouldn’t want no-deal Brexit. So we hopefully Brexit could be done through ordinary and calm way.”

Japan has long seen Britain as a pro-business, liberal gateway into the rest of the European Union and has around 1,000 companies based in the country, including major carmakers and technology firms. Japanese firms have invested over 60 billion pounds in Britain.

But the 2016 vote to leave the European Union, some Japanese firms have begun moving business out of Britain with particular concern over the impact of a disorderly exit on Oct. 31.

“Please, no no-deal Brexit,” Kono told the BBC. “Some companies are already starting to move their operations to other places in Europe.”

Asked whether investment could leave Britain, Kono said: “It could be that there is going to be less investment.”

But Honda announced earlier this year that it will close its British plant whilst Nissan cancelled plans to build a new sports utility vehicle at its Sunderland factory in the north of England. Both blamed factors other than Brexit.

Kono warned on Thursday about the impact of a disorderly exit on the sector.

“If there’s a no-deal Brexit and if they have to go through actual custom inspections physically, those operations may not be able to continue,” he said.


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