JAPAN has a "high stake" in Brexit trade negotiations and firms cannot operate in the UK if it is not profitable, the country's ambassador to the UK has said.

Koji Tsuruoka said Prime Minister Theresa May had acknowledged the importance of Japan to Britain's post-union economy and added major Japanese firms were "determined" to continue operating in the country but wanted "clarity".

Mr Tsuruoka was speaking in Downing Street after a meeting between Mrs May and heads of businesses including car makers Mitsubishi, Honda and Sunderland-based Nissan.

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The firm's bustling Wearside plant is gearing up to start production of next generation Qashqai and X-Trail models, with the work confirmed in 2016 after Government talks assured bosses that Brexit wouldn't affect the factory’s competitiveness.

However, Mr Tsuruoka warned: "If there is no profitability of continuing operations in the UK, not Japanese only, no private company can continue operation.

"It is as simple as that.

"This is all high stakes and I think all of us need to keep in mind."

Mrs May told the businessmen Brexit would allow the UK to forge a free trade deal with Japan.

Joined by Chancellor Phillip Hammond, Business Secretary Greg Clark and International Trade Secretary Liam Fox, Mrs May opened the meeting, saying: "As we look ahead of course I recognise that UK's exit for the EU is no small undertaking.

"But, importantly, it does present an opportunity to strike free trade deals around the world and build on our already strong relationship with Japan."

Mr Tsuruoka added companies, in particular the major manufacturers, "expected" free access to the European market and Japan had also lobbied Brussels on the importance of "healthy, sound" trade relations.

After the meeting, a Downing Street spokesman said: "The Prime Minister set out her vision for an outward looking, global Britain, and the long-term opportunities presented by the modern Industrial Strategy.

"Business representatives expressed their appreciation for the opportunity for constructive dialogue with the Government, and agreed on the importance of the time-limited implementation period in providing clarity and certainty for people and businesses.

"There was also agreement on the importance of moving quickly in the negotiations to secure a trading relationship with the EU that is as tariff-free and frictionless as possible following the implementation period."