Britain is expected to announce it is joining forces with eleven other CPTPP countries today with access to an enormous $10 trillion market.
The trailblazing post-Brexit win will see the UK become the first non-founding member of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).
Joining the partnership will give British businesses easier access to markets worth $10 trillion and tariff-free access on over 99% of goods to a market of around 500 million customers.
The UK’s membership will also add another like-minded partner and strong voice to this powerful alliance, taking the trade bloc’s GDP to £11 trillion.
As a major economy and strong advocate of free trade, our membership will support the trade bloc to shape the high standards of global trade – particularly in the face of increased protectionism.
Minister of State for Trade Policy Greg Hands said:
“JOINING CPTPP WILL ADD EVEN MORE ECONOMIC CLOUT TO THIS EXCITING AND DYNAMIC TRADE ALLIANCE, HELPING IT GROW TO £11 TRILLION OR FROM 12 TO 15% OF GLOBAL GDP.”
The CPTPP, which was formed in 2018, currently has 11 countries as members: Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam.
The huge trading block accounts for 13 percent of global domestic product (GDP) and 15 percent of global trade.
Joining the partnership will cut tariffs for UK industries including food and drink, and cars, while also creating new opportunities for modern industries like tech and services, ultimately supporting and creating high-value jobs across the UK. Unlike EU membership, joining does not require the UK to cede control over our laws, borders, or money.
Benefits that CPTPP membership will bring for businesses include:
- Modern digital trade rules that allow data to flow freely between members, remove unnecessary barriers for businesses, and protect commercial source code and encryption.
- Eliminating tariffs quicker on UK exports including whisky (down from 165% to 0% in Malaysia) and cars (reducing to 0% in Canada by 2022, two years earlier than through the UK-Canada trade deal).
- Rules of Origin that allow content from any country within CPTPP to count as ‘originating’. For example, this would mean that cars made in the UK could use more Japanese-originating car parts, such as batteries.
- Easier travel for businesspeople between CPTPP countries, such as the potential for faster and cheaper visas.
Julian David, CEO of techUK, said:
“Today marks an important step in the UK’s path to developing a modern trade policy that creates new opportunities for the UK tech sector. Building on our recent agreements with Japan and the European Union, the accession to the CPTPP will allow us to join a group of ambitious countries breaking the newest ground in digital trade.
“The UK has been a major beneficiary of the rise of digital trade with over 67% of service exports worth £190.3 billion being digitally delivered. CPTPP will open up new markets for innovative tech SMEs looking to grow and expand beyond our borders. We are looking forward to working with the government throughout the process.”
Mike Cherry, Federation of Small Businesses (FSB) Chair continued:
“Membership of the CPTPP would be a hugely welcome development to all small businesses looking to either expand or begin their trading journeys.
“Crucially, at the very heart of this agreement is an SME chapter, something that we have lobbied for the inclusion of in every FTA, ensuring that no business is left behind.
“This is truly a world-leading agreement and one that will genuinely help small firms to thrive and succeed more than ever.”
CBI President, Lord Karan Bilimoria added:
“This ambition marks a new chapter for our independent trade policy. As one of the largest free trade agreements in the world, these 11 countries contribute over £100 billion to our economy.
“Membership of the bloc has the potential to deliver new opportunities for UK business across different sectors. The CBI will continue to work with the Government to ensure that firms get the most out of an agreement that will create jobs and deliver wide-ranging benefits to communities across the country.”
Stephanie Rickard, professor of political science at the London School of Economics, said:
“The UK is trailblazing. This is changing the agreement from being a regional agreement to a global agreement.”
