The British general election also affects Japanese companies

The British general election also affected Japanese companies at 1:18 on December 13

For Japan, Britain is the second most important trading partner in Europe after Germany. For that reason, the results of the British general election can have a major impact on the Japanese economy.

According to the Ministry of Finance trade statistics, the export value in 2018 was 1,534.0 billion yen, with the largest number of automobiles being 253.4 billion yen, accounting for 17% of the total, followed by the engine with 124.5 billion yen It is a prime mover.

On the other hand, the import value is 909.0 billion yen. This is the fourth level in Europe after Germany, France and Italy. By item, the number of automobiles is the largest at 159 billion yen, accounting for 17% of the total. The next largest number of pharmaceuticals is 15.41 billion yen, accounting for almost the same import value as automobiles, and many whiskeys are also imported.

The EPA = Economic Partnership Agreement between Japan and the EU has entered into force and tariffs have been eliminated or reduced for many goods. However, if the UK leaves the EU, tariffs on trade with the UK can be restored. There is sex. In particular, if there is a “leave without agreement”, the Japanese government is calling on both the UK and the EU to avoid “leave without agreement” because it could have a significant impact on the business of Japanese companies.

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The UK has a deep business relationship with nearly 1000 Japanese companies entering the country.

According to the Ministry of Foreign Affairs of Japan's survey on the number of Japanese residents overseas, there are 966 Japanese companies operating in the UK as of October 2018, the second largest number of Japanese companies in Europe after Germany.

Investment by Japanese companies continues. According to JETRO = Japan External Trade Organization, the balance of "direct investment" in which Japanese companies built factories or acquired local companies in the UK increased by $ 163.4 billion at the end of 2018, increasing for the ninth consecutive year It was.

In 2016, SOFTBANK Group acquired ARM Holdings, a semiconductor development company headquartered in the UK, for approximately ¥ 3.3 trillion, and in 2019, Asahi Group Holdings, UK's Fuller Smith & Turner luxury beer business A large number of large-scale projects such as the acquisition of approximately 36 billion yen.

On the other hand, Nissan has been revising its strategy in February, such as withdrawing its plan to produce new models of some models at a plant in the north of England. It is difficult for Japanese companies to conduct local business while paying attention to the move toward leaving the UK in the UK.

More than 70% replied that there was a negative impact

The move towards UK withdrawal from the EU has already had a negative impact on Japanese companies doing business locally. JETRO surveyed 979 Japanese companies in Europe from September to October, and 842 companies, 86% of the total, answered.

According to it, 70.8% of the 65 UK-based manufacturers “had a negative impact” in response to the question “How did the UK move towards the EU leave the business?” I answered. “No effect” was 23.1%. The percentage of companies that answered “There was a positive impact” was 1.5%, and the fact that the move toward UK withdrawal from the EU had already had a negative impact on Japanese manufacturers doing business locally was highlighted. .

In addition, when asked if they are taking measures to prepare for so-called “no agreement”, 78.6% of manufacturers based in the UK responded that “measures have been taken” or “plans for taking measures”. In view of the disruption of customs clearance procedures, we can see that we are trying to minimize the impact, such as “stocking up” and “changing logistics routes”.

Major financial institutions also respond

A major Japanese financial institution based in the UK is preparing for a departure from the EU and is already working on a new base in another European country.

The EU has a system called a “single passport” that can be operated in other countries if authorized by one of the member countries. However, financial institutions that are licensed in the UK may be restricted from doing business in the EU after leaving. For this reason, Sumitomo Mitsui Banking Corporation established a new base in Frankfurt, Germany, and started operations in April.

On the other hand, Mitsubishi UFJ Bank and Mizuho Bank already have bases in the Netherlands as well as in the UK, so there will be no restrictions on operations even after the withdrawal.

Among the securities companies, Daiwa Securities Group Inc., Mizuho Securities, Nomura Holdings, and SMBC Nikko Securities have established new bases in Frankfurt, Germany. Mitsubishi UFJ Securities Holdings has established a new base in Amsterdam, the Netherlands, and has begun operations. For this reason, each company says that it will not hinder their business even if the UK leaves the EU.