UK and Japan agree £18bn investment deal in London talks

The UK and Japan have agreed an £18bn investment package during talks in London between Prime Minister Sir Keir Starmer and Japan's leader Sanae Takaichi. The announcement was made after the two sides met business leaders at Downing Street on Sunday. It covers infrastructure, financial services, offshore wind, nuclear technology and research cooperation.

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Downing Street said Japanese firms will spend more than £9bn on UK infrastructure and financial services, with up to £9bn also earmarked for UK offshore wind. Officials said the package could create tens of thousands of jobs, although it was not immediately clear how much of the total represents new money rather than previously announced plans. Starmer described the discussions as very productive, while Takaichi said the UK is an extremely important partner.

The deal also includes further cooperation on the Gcap fighter jet programme, which is being developed with Italy, and a new agreement linking UK research and development and software expertise with Japanese manufacturing. Rolls-Royce is to work with Japan's Atomic Energy Agency on next-generation nuclear technologies. Japanese property groups including Mitsubishi Estate, Mitsui Fudosan and Nomura Real Estate were among the firms named as agreeing to spend billions over the next five years on infrastructure and real estate projects.

The package matters because it ties together trade, industrial policy and strategic cooperation at a time when the UK is seeking stronger investment and growth. It also reinforces a broader relationship that already includes defence and advanced technology links. For Japan, the agreement gives its companies a larger role in UK projects in sectors such as energy, transport and finance.

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The announcement comes as the UK economy has been struggling to grow, with analysts warning of near-term pressure from higher costs and wider global uncertainty. The government has said the investment will support long-term growth, but the scale of the immediate economic benefit is still uncertain. The opposition Conservative party said it welcomed any deal that brings investment, while criticising Labour's tax rises and employment rules.

What remains unclear is how much of the £18bn package is genuinely new investment and how much had already been planned. It is also not yet clear how quickly the projects will be delivered or how many jobs will materialise in the short term. The next stage will be whether the commitments turn into signed contracts and project announcements over the coming months.

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