‘Milestone’: UK first European country to join CPTPP trade bloc
The UK has become the first European nation to join the CPTPP trade bloc after its membership formally took effect.
Britain’s participation in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) came into force on Sunday, December 15.
The major Indo-Pacific trade partnership comprises member states Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam, and will now have a combined GDP value of £12 trillion, including the UK.
UK officials hope the move could add up to £2bn to the UK economy, with ministers highlighting business opportunities to trade overseas.
The move was welcomed by TheCityUK international managing director Nicola Watkinson, who said: “Formally joining membership of the CPTPP is a significant milestone for the UK.
“It offers firms across our industry opportunities to build on the benefits of greater access to one of the fastest growing regions in the world in areas such as insurance, asset management and sustainable finance, and the burgeoning growth corridors within it.”
CPTPP ratification
She also cited the potential for “pioneering digital trade, building regulatory cooperation and international standards”.
The UK will enter into the agreement with the eight of the bloc’s 11 existing members who first ratified the accession on Sunday – Japan, Singapore, Chile, New Zealand, Vietnam, Peru, Malaysia and Brunei.
It will then, on Christmas Eve, enter into force with Australia, who later ratified the deal.
Canada and Mexico are yet to finally rubber-stamp the UK’s membership, but it is understood that officials expect them to do so at some point in the future.
It is expected that the CPTPP will get larger in the coming years, and last month it was announced Costa Rica would be the next country to work through the process of joining.
The deal will offer UK firms lower tariffs and fewer barriers when trading across three continents, with financial services, manufacturing and food and drink sectors set to benefit.
‘Open for business’
Business and trade secretary Jonathan Reynolds said: “Britain is uniquely placed to take advantage of exciting new markets, while strengthening existing relationships.
“Today’s news is further proof that the UK is a wonderful place to do business, with an open, outward looking economy driving the growth people can feel in their communities.
“Agreements like this boost trade and create opportunities for UK companies abroad. This is a proven way to support jobs, raise wages, and drive investment across the country which is key to this government’s mission to deliver economic growth.”
HSBC UK chief executive Ian Stuart said the announcement “signals that the UK is open for business with some of the world’s most exciting growth markets”.
While Scalerr chief executive Matthew Borthwick cited the benefits for UK small and medium sized enterprises (SMEs), adding: “International expansion isn’t just for the big businesses out there… UK SMEs will also benefit, making it easier to trade with CPTPP countries.”
Updated ‘rules of origin’ provisions will also benefit the car industry and food and drink manufacturing, officials added, while UK services firms could find exporting made easier.
Conservative leader Kemi Badenoch, who was trade secretary when the UK formally agreed to join the bloc in 2023, said: “The Conservatives delivered CPTPP – a trade deal that brings enormous benefits to everyone from British farmers to fintech and small businesses to the largest manufacturers.
“However, joining a trade bloc is only the start. Labour spent the last parliament mocking our CPTPP negotiations, and they now have a responsibility to ensure that UK companies can make the most of this landmark deal.”