In a landmark development for British trade relations, the United Kingdom has become the first European nation to join the Indo-Pacific trade bloc, marking a significant post-Brexit milestone. The move, whilst celebrated by both major political parties, comes with modest economic projections that pale in comparison to Brexit-related losses.
The agreement, signed in 2023 by then-Trade Minister Kemi Badenoch, integrates Britain as the 12th member of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), joining nations including Australia, Japan, Canada, and Singapore. The government suggests this membership will eliminate tariffs on 99 per cent of UK goods exports to CPTPP countries, benefiting sectors such as automotive, financial services, and food and drink.
Economic forecasts present a sobering perspective, with the deal expected to boost UK GDP by merely 0.08 per cent in the long term. This figure stands in stark contrast to the Office for Budget Responsibility’s calculation of a 4 per cent GDP reduction resulting from Brexit. Trade experts acknowledge the agreement’s potential to streamline supply chains, particularly in the automotive sector, while facilitating exports of premium products like whisky.
The financial services sector stands to gain from enhanced operational freedoms, with British firms receiving improved access to manage funds across CPTPP markets. Labour’s Trade Secretary, Jonathan Reynolds, has endorsed the agreement while simultaneously advocating for reduced trade barriers with the European Union.
Conservative officials emphasise that CPTPP membership effectively prevents any future return to the EU customs union, though Labour leader Sir Keir Starmer has already dismissed such a possibility. The government’s focus now shifts to maximising the benefits of this partnership, with calls for British companies to actively engage with the opportunities presented by this expansive trade network.
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