Japanese companies in UK worried over 'Hard Brexit'

Many companies may consider relocating operations to Europe if Britain unable to establish deal with EU prior to Brexit deadline in March

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(By Associated Press)

TAIPEI (Taiwan News) – Many Japanese companies are growing increasingly worried about the possibility of a “hard Brexit” if the U.K. is unable to agree to a deal with the European Union, which appears increasingly less likely as the March Brexit deadline nears.

Japanese Prime Minster Shinzo Abe, recently met with U.K. Prime Minister Teresa May, and said that "We truly hope that a no-deal Brexit will be avoided. In fact, that is the wish of the whole world."

The Japanese Ambassador to the U.K., Koji Tsuruoka (鶴岡公二), has recently stated that Brexit is not good for foreign investment, and that without a reliable deal in place, many “private investors will be unable to operate.”

Many Japanese firms are already making motions to decrease investment and operations in Britain, with Panasonic having already relocated its main European base of operations from London to Amsterdam, with MUJI reportedly considering a similar move to Germany.

Toyota has reportedly indicated that if the U.K. proceeds with a hard brexit, then it may be forced to temporarily halt manufacturing at its Derby factory, until new arrangements for the export of automobiles can be arranged.

Spokesperson for the Japanese Embassy in London, Shinichi Iida (飯田慎一), has stated that many Japanese companies originally invested in the U.K. as a “gateway into Europe,” so if Brexit proceeds without a deal it will essentially leave them “facing a cliff,” reports UDN.

Japan and the U.K. have enjoyed very productive bilateral trade relations in recent years, with Japan investing US$153 billion into the U.K last year. About 1,000 Japanese companies operate in the U.K. and employ approximately 160,000 people.

According to a recent survey of Japanese companies in Britain, 47 percent of them believe that Brexit is harmful to their business, especially with regard to the export of products bound for the European Union, reports UDN.