THE TTALK QUOTES

On Global Trade & Investment
Published Three Times a Week (with occasional bonus quotes) by
The Global Business Dialogue, Inc.
Washington, DC  20006
No.61 of 2020
FRIDAY, AUGUST 14, 2020, PART I

Click HERE for last Thursday's quote on "One Belt, One Road."

UK-JAPAN TRADE - ON CHICKENS, EGGS, AND CHEESE

"'One The arrival of the Japanese trade minister for intensive talks is a signal that a new trade deal could be close to being reached, perhaps as soon as today."

The Times (London)
August 7, 020
CONTEXT
When Japan's Foreign Minister Toshimitsu Motegi flew to the UK at the end of last week, expectations for a “done deal” announcement from the UK and Japan swelled. That expectation was expressed in last Friday’s editorial (leading article) in The Times, which was the source for today’s featured quote.  

Then on August 10, The Financial Times reported that the deal was off, at least for now. Liz Truss, the UK Secretary of State for International Trade, wanted more. Specifically, she wanted more in the way of market access for blue cheese, for Stilton, than Minister Motegi was prepared to concede. It was a disappointment, but at least the British press got to have some fun with the obvious metaphors. Several referred to Stilton as a wedge in the negotiations, at least one favored the idea that the talks were crumbling, and The Telegraph said Stilton was causing a stink.  
COMMENT
Does this mean there won’t be a UK-Japan deal this year, or  that WTO terms for UK-Japan trade will kick in on January 1? Maybe. Or maybe not. True, one shouldn’t count one’s chickens before they hatch. Still, our guess is that this was one of those minor melodramas that mark the end of most (trade) negotiations. The big issues, cars for example, have been agreed, and the larger reality of the importance of the UK-Japan trade and investment relationship dwarfs the latest stumbling block, with two-way merchandize trade valued at more than $51 billion in 2019. Britain’s blue cheese exports to Japan last year accounted for only $133,000 (£102,000) of that. So, we think it unlikely that either side will let cheese tariffs kill this deal or even delay it for very long.  

The fact is that Her Majesty’s Government has a strong incentive to put some points on the board in the on-going game of Brexit. As for Japan, the same Times editorial that gave us today’s quote also gave us this: 

[I]t is Japan that has the most to gain from a deal. The DIT [Department of International Trade] estimates that British Exports to Japan would increase by 21 percent relative to no deal but Japanese exports to the UK would jump 79 percent.

And upbeat voices are emerging. One of them is Tomohiko Taniguchim, an adviser to Prime Minister Abe. He recently talked about Stilton as a British “soul food” whose importance to the UK the Japanese side may have underestimated.  “The stumbling block is relatively small,” he said. “I’m optimistic.”  

SOURCES AND LINKS
The Times View is a link to this August 7 editorial/leading article from The Times (London) on the anticipated trade deal between the UK and Japan. This was the source for today’s s featured quote.  

Stilton Drives a Wedge takes you to the BBC report on this development referenced above.  

Photo Credit: Designgeist at English Wikipedai.

Deal Close is a July 29 Bloomberg report on the UK-Japan negotiations.  

About Cars and Agriculture is an August 9 assessment of the UK-Japan negotiations from the Nikkei Asian Review. 

Stilton Causing a Stink is the August 11 article from The Telegraph on Stilton and the UK-Japan trade talks. 

Talks Stalled over Stilton is a link to the August 10 Financial Times article mentioned above.  

Japan “Optimistic” is an August 13 story from The Sun with a fairly upbeat assessment from an adviser to Prime Minister Abe.  

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