The UK and Japan agreed an £18 billion investment deal on Sunday, June 14, 2026, to boost infrastructure and clean energy. The agreement includes more than £9 billion for financial services and infrastructure and up to £9 billion for offshore wind, according to Downing Street and the BBC.
How the £18 billion investment is distributed
The deal splits the total investment into two primary categories. Japanese firms will spend more than £9 billion on UK infrastructure and financial services, according to the BBC. Downing Street identified Mitsubishi Estate, Mitsui Fudosan, and Nomura Real Estate as firms that agreed to spend billions over the next five years. GOV.UK reports this investment pipeline is expected to create innovation hubs, high-quality office space and new towns.
The remaining portion consists of up to £9 billion directed toward the UK offshore wind sector, according to the BBC and GOV.UK. This funding is part of an Offshore Wind Compact
developed with Great British Energy, the UK’s state-owned energy company designed to co-invest in clean power projects to accelerate the transition to net zero.
According to GOV.UK, the investment will support 5.9GW of floating offshore wind projects. Unlike traditional fixed-bottom turbines, floating wind technology allows turbines to be placed in deeper waters where winds are stronger and more consistent. The specific projects include:
- The Ossian project (East Coast of Scotland)
- The Green Volt project (East Coast of Scotland)
- The Erebus project (Celtic Sea)
GOV.UK states these projects will generate enough clean electricity to power 8 million homes.
New partnerships in nuclear and defense technology
Beyond direct financial investment, the two nations signed more than 10 commercial and government agreements, according to the Guardian. One agreement links UK software expertise and research and development with Japanese manufacturing, according to the BBC.
The deal includes a deepening of collaboration between Rolls-Royce and Japan’s Atomic Energy Agency to develop next-generation nuclear technologies, Downing Street said. This collaboration focuses on the development of Small Modular Reactors (SMRs), which are smaller, factory-built nuclear reactors designed to be deployed more quickly and cost-effectively than traditional large-scale plants.
Additionally, a new technology partnership will focus on AI, semiconductors and quantum computing, according to GOV.UK.
In the defense sector, Sir Keir Starmer said the two countries reaffirmed their commitment to the Gcap fighter jet programme, which is being developed alongside Italy, according to the BBC. The Global Combat Air Programme (GCAP) aims to produce a sixth-generation fighter jet, integrating advanced stealth and sensor technology through a partnership involving BAE Systems, Leonardo, and Mitsubishi Heavy Industries. No 10 also stated that discussions included helping UK defense firms access Japanese investment, according to the Guardian.
Economic goals amid political instability
Downing Street claims the deal will create tens of thousands of jobs
, according to the BBC. GOV.UK specified that Hitachi Energy UK is set to create at least 500 new jobs over the next five years to expand the UK grid.
These agreements arrive as the UK economy faces several pressures. The BBC reports that experts predict the US-Israel war with Iran will hit the UK particularly hard. Additionally, the Daily Mirror cited a report warning that 1.25 million young people could be out of work, training or education within five years, noting February Office for National Statistics figures that estimated around 957,000 young people aged 18 to 24 are Neets
.
The term Neet
is used by the Office for National Statistics to describe individuals who are Not in Education, Employment, or Training. This metric is frequently used by the UK government to track youth unemployment and systemic gaps in vocational training.
The investment announcement coincides with significant volatility within the UK government. The Guardian and Daily Mirror report that Prime Minister Keir Starmer’s leadership is under pressure following the shock resignation
of John Healey as defense secretary. Healey resigned over a dispute regarding long-term military funding. He was joined in his exit by armed forces minister Al Carns and two parliamentary aides, according to the Guardian.
These landmark agreements will bring multibillion-pound investment into the UK, creating tens of thousands of new jobs and driving new developments. As G7 economies and close security partners, we are working together with Japan on some of the most innovative technology in the world, harnessing the best of British and Japanese research and industry to deliver growth and security to every corner of the United Kingdom.
Sir Keir Starmer, UK Prime Minister
The meeting in London took place ahead of the G7 summit in Évian-les-Bains, according to GOV.UK. The G7 is an intergovernmental political forum consisting of Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States, which coordinates global economic policy and security strategies.
Speaking through a translator, Japanese Prime Minister Sanae Takaichi described the UK as an extremely important partner
, according to the BBC.
