UK strikes agreement to join Asia-Pacific trade bloc

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87 shares, 148 points

The UK on Friday unveiled an agreement to join an 11-member Asia-Pacific trade bloc, with British prime minister Rishi Sunak claiming it proved his government was seizing “post-Brexit freedoms”.

Talks on Britain becoming a member of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership were finally wrapped up after two years of haggling over quotas and tariffs.

The UK will be the first country to join the CPTPP since the group was established in 2018, and Sunak said the trade deal will bring economic benefits and also boost his “Asia-Pacific” tilt to Britain’s foreign policy.

The current members of the CPTPP are Australia, Canada, Japan, Mexico, New Zealand, Singapore, Brunei, Chile, Malaysia, Peru and Vietnam.

Sunak said: “We are at our heart an open and free-trading nation, and this deal demonstrates the real economic benefits of our post-Brexit freedoms.

“Joining the CPTPP trade bloc puts the UK at the centre of a dynamic and growing group of Pacific economies, as the first new nation and first European country to join.”

Downing Street said more than 99 per cent of UK goods exports to CPTPP countries will now be eligible for zero tariffs, including products such as cheese, cars, chocolate, machinery, gin and whisky.

But the economic gains for Britain are minimal, according to the government’s own projections, and will do little to offset the EU trade losses incurred as a result of Brexit.

The government estimates the CPTPP deal will increase UK gross domestic product in the long term by just 0.08 per cent, although it said that could rise if Thailand and South Korea later joined the group.

However, Britain’s decision to join the CPTPP gives it a strengthened economic presence in a region which is preoccupied with how to respond to the rise of China, which has applied to join the trade bloc.

Kemi Badenoch, trade secretary, argues the deal is the most significant commercial agreement signed by the UK since Brexit, with a potential to grow in importance as the rise of Pacific Rim countries continues.

She says the agreement protects the UK’s vital interests, including agriculture and the NHS, and upholds high animal welfare and food safety standards.

But the CPTPP deal is controversial, with special criticism levelled at the decision to cut UK tariffs on imports of Malaysian palm oil, production of which has been linked to the destruction of rainforest.

Daniela Montalto, head of forests at Greenpeace UK, described the deal as “outrageous”, adding that cutting palm oil tariffs would only incentivise further destruction.

Another contentious issue raised by the deal was access to the UK for beef from Canada.

Canadian beef is not currently on sale in the UK because the country’s cattle are treated with hormones that are banned in Britain.

Under the CPTPP deal, the UK will set an annual quota of 13,000 tonnes for imports of Canadian beef.

But the meat will have to meet UK food standards, meaning little is actually likely to be permitted for sale in Britain.

Source: Financial Times

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