Britain is starting negotiations on Tuesday to join a free trade area which could grant businesses access to “some of the biggest economies of the present and future”, the UK government has said.
The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) covers a market of around 500 million people.
The group was established in 2018 and the UK is the first non-founding country to apply to join. If successful, it will be the group’s second biggest economy after Japan.
It is made up of 11 nations: Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam are the founding members.
The UK applied to join the bloc in January following Brexit.
“The trade area is the part of the world where Britain’s greatest opportunities lie,” said International Trade Secretary Liz Truss. “Being granted membership would be a glittering post-Brexit prize.”
Truss said membership would help British “farmers, manufacturers and innovators sell to some of the biggest economies of the present and future, but without ceding control over our laws, borders or money”.
The free trade agreement aims to reduce trade tariffs between member countries and includes a promise to eliminate or reduce 95% of charges on traded goods.
In return, countries must cooperate on regulations, such as food standards. However, these standards and regulations do not have to be identical, and member countries can strike their own trade deals.
However, with deals already in place with eight of the CPTPP members, joining may add as little as 0.1% to the size of the UK economy, and it’s not clear yet what the UK will have to concede to get the deal, nor how quickly it will happen.
The real boost will come if others sign up to this pact. So far, America under President Joe Biden hasn’t expressed an interest in doing so, neither has it set a date to resume talks on a UK-US bilateral deal, paused earlier this year.
As trading partners go, the US is twice as important to the UK as all the CPTPP nations put together.
However, the CPTPP is likely to keep expanding.
The Department for International Trade said, “Benefits would increase over time, with the Philippines, Thailand, Taiwan and the Republic of Korea all having expressed interest in joining.”