May in Japan with eye on Brexit fears

BRITISH Prime Minister Theresa May arrived in Japan on an official visit yesterday with an eye to soothing Brexit fears and pushing ahead on early free-trade talks with the world’s number three economy.

May is scheduled to sit down with Toyota’s chairman during her threeday tour which starts in Osaka before moving to Tokyo where she will meet with Emperor Akihito and Prime Minister Shinzo Abe, who visited Britain this year.

Britain formally told the EU in March it will withdraw from the 28member bloc, stirring fears in Japan about what the move would mean for companies with significant business interests in the country.

“We’re going to ask for transparency and predictability so as to minimise the impact on [our] companies,” a Japanese foreign ministry official in charge of European affairs said.

More than 1 000 Japanese companies do business in Britain, employing some 140 000 local people with many using Britain as a staging post to do business in Europe. Among them, Toyota and Nissan have factories in Britain while tech giant SoftBank last year announced a $32-billion purchase of British iPhone chip designer ARM.

But Britain is now at risk of losing the “passporting rights” financial firms use to deal with clients in the rest of the European bloc.

That, along with political uncertainty surrounding Brexit negotiations, has spurred foreign companies that have set up shop in Britain, or established European headquarters there, to begin looking for alternative locations.

Japanese megabank Mitsubishi UFJ is mulling Amsterdam or Paris as a new European base for its securities operations.

Brokerage Nomura, Daiwa Securities and Sumitomo Mitsui Financial Group are planning to move their main EU bases from London to Frankfurt.

Japanese firms need solid assurances from May. — AFP