Japanese firms will pour more than £18bn into UK infrastructure, financial services and offshore wind under a deal that Sir Keir Starmer said would build a “new era of co-operation” between the two nations.
The prime minister met his Japanese counterpart, Sanae Takaichi, in London on Sunday, where they also reaffirmed their commitment to the Gcap fighter jet programme being developed alongside Italy. “We had a very productive set of discussions,” Starmer said afterwards, as he welcomed business leaders from both countries to Downing Street.
“Japanese firms pledge £18bn for UK infrastructure and offshore wind, Starmer hails new era of co-operation.”
The investment comes as the UK’s economy struggles to grow, with the International Monetary Fund warning last month that the US-Israel war with Iran would hit Britain harder than any other advanced economy. Yet it is not clear how much of the money listed by Downing Street represents new commitments rather than previously announced plans.
Japanese firms including Mitsubishi Estate, Mitsui Fudosan and Nomura Real Estate have agreed to spend billions over the next five years on infrastructure and real estate projects, Downing Street said. A separate pledge of up to £9bn will go towards UK offshore wind, creating tens of thousands of jobs.
Separately, Rolls-Royce will work with Japan’s Atomic Energy Agency to develop next-generation nuclear technologies, while a new technology agreement will link UK research and software expertise with Japanese manufacturing.
Speaking through a translator, Takaichi called the UK “an extremely important partner”.
But the Conservative shadow business and trade secretary, Andrew Griffith, gave a guarded welcome. “While we welcome any deal that brings investment, Labour’s tax hikes and employer red tape are doing huge damage, destroying jobs and putting more and more people onto welfare,” he said.
Despite the optimism, experts expect economic pain in the near term. The UK grew by 0.6% in the first three months of the year – the fastest of any G7 economy – but analysts believe growth will be sluggish in the months ahead. The IMF, however, expects Britain to recover and become the fastest-growing European economy in the G7 next year, albeit at a slightly slower rate of 1.3%.