The UK and Japan have agreed to an £18 billion investment deal focused on developing energy, technology, and financial services. During a meeting in London on Sunday, UK Prime Minister Sir Keir Starmer and Japanese Prime Minister Sanae Takaichi announced the partnership, which Starmer described as building a “new era of co-operation.” Downing Street stated that Japanese firms will spend more than £9bn on UK infrastructure and financial services and up to £9bn on UK offshore wind, creating tens of thousands of jobs. A central component of the agreement is a landmark Offshore Wind Compact developed in partnership with Great British Energy. This compact supports up to £9bn in Japanese investment for 5.9GW of floating offshore wind projects, including the Ossian and Green Volt projects off Scotland’s east coast and the Erebus project in the Celtic Sea. These projects are intended to generate enough clean electricity to power eight million homes. While Downing Street noted that some listed investments, such as Hitachi Energy’s Glasgow Centre of Excellence, were previously announced, the deal represents a future commitment to exchange technology and investment. The agreement includes several specific industrial collaborations. Rolls-Royce will work with Japan’s Atomic Energy Agency and the UK National Nuclear Laboratory to develop next-generation nuclear technologies. Also, a technology agreement will link UK research, development, and software expertise with Japanese manufacturing. BAE Systems and NEC Corporation also signed a Memorandum of Understanding to implement active cyber defence solutions for the Japanese Government. Other Japanese firms, including Mitsubishi Estate, Mitsui Fudosan, and Nomura Real Estate, agreed to spend billions over the next five years on infrastructure and real estate projects. The deal arrives as the UK economy faces potential challenges. While the UK economy grew by 0.6% in the first three months of the year, the fastest growth among G7 economies, analysts predict sluggish growth ahead. The International Monetary Fund stated last month that the US-Israel war with Iran will hit the UK hardest among advanced economies, though it expects the UK to recover and become the fastest-growing European economy in the smaller G7 group next year at a growth rate of 1.3%. Conservative shadow business and trade secretary Andrew Griffith welcomed the investment but claimed Labour’s “tax hikes and employer red tape” are damaging jobs.