UK applying to join Asia-Pacific free trade pact CPTPP
February 1, 2021 5:57 am
U.K. International Trade Secretary Liz Truss [Source: BBC]
The UK will apply to join a free trade area with 11 Asia and Pacific nations on Monday, a year after it officially left the EU.
Joining the group of “fast-growing nations” will boost UK exports, the government says.
The Comprehensive and Progressive Agreement for Trans-Pacific Partnership – or CPTPP – covers a market of around 500 million people.
But they are harder to reach than neighbouring markets in Europe.
Members include Australia, Canada, Japan and New Zealand.
Brunei, Chile, Malaysia, Mexico, Peru, Singapore and Vietnam are also founder members of the bloc, which was established in 2018.
“In future it’s going to be Asia-Pacific countries in particular where the big markets are, where growing middle-class markets are, for British products,” International Trade Secretary Liz Truss told the BBC’s Andrew Marr.
“Of course British businesses will have to reach out and take these opportunities, but what I’m doing is I’m creating the opportunities, the low tariffs, removing those barriers so they can go out and do that.”
Joining the bloc would reduce tariffs on UK exports such as whisky and cars, as well as service industries, she said.
However the immediate impact is likely to be modest as the UK already has free trade deals in place with several CPTPP members, some of which were rolled over from its EU membership. The UK is negotiating deals with Australia and New Zealand.
In total, CPTPP nations accounted for 8.4% of UK exports in 2019, roughly the same proportion as Germany alone.
The US was originally in talks to be part of the CPTPP, but former President Donald Trump pulled out when he took office.
If the new administration in Washington were to reconsider the CPTPP, that would make membership much more attractive to the UK. It could allow a much closer UK-US trading relationship, without waiting for a bilateral trade deal to be negotiated.