Britain launches negotiations with £9tn Pacific free trade area

Seoul, South Korea

Seoul, South Korea

Britain will today launch negotiations with 11 countries belonging to a £9tn free trade area.

The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) is home to 500 million people and includes some of the world’s biggest current and future economies across Asia-Pacific and the Americas. Joining would give our exporters and services firms better access to these dynamic markets, with almost two-thirds of the world’s middle classes expected to be in Asia by 2030.

Exports to CPTPP countries are set to increase by 65% up to 2030 – £37bn. Joining would boost this growth and support British jobs. The Philippines, Thailand, Taiwan and the Republic of Korea all having expressed interest in joining. Negotiating is set to take several months.

Membership would lower tariffs on key British exports and should mean tariff-free trade for 99.9% of all exports.

Joining CPTPP would also open new financial and professional services markets for British firms, making it easier for highly skilled Brits to live and work in member countries.

Prime Minister Boris Johnson said: “Membership of the CPTTP free-trade partnership would open up unparalleled opportunities for British businesses and consumers in the fast-growing Indo-Pacific. It’s an exciting opportunity to build on this country’s entrepreneurial spirit and free-trading history to bring economic benefits across the whole of the UK.”

International Trade Secretary Liz Truss said: “This part of the world is where Britain’s greatest opportunities lie. We left the EU with the promise of deepening links with old allies and fast-growing consumer markets beyond Europe, and joining the high-standards Trans-Pacific Partnership is an important part of that vision. Membership would help our farmers, makers and innovators sell to some of the biggest economies of the present and future, but without ceding control over our laws, borders or money. It is a glittering post-Brexit prize that I want us to seize.”

Industry reaction

Miles Celic, Chief Executive Officer, TheCityUK, said: “The world’s economic centre of gravity is shifting towards the Indo-Pacific. Being part of the CPTPP would give UK firms greater access to one of the fastest growing populations of middle-class consumers in the world. This economic shift will increase demand for the financial and related professional services and products in which the UK excels.

“Joining CPTPP offers Britain an additional platform to make a case for open market and the liberalisation of services trade, a significant prize for the UK and the global trading system. Membership will help the UK to work more closely with other CPTPP members to develop innovative approaches on key strategic trade priority areas, including data, cross-border payments, regulatory coherence, investment protection, and the mutual recognition of professional qualifications.”

Gerard Grech, CEO of Tech Nation, said: “We welcome the UK’s membership of the CPTPP. There has never been a better time for UK tech on the global stage. The UK was the fifth greatest digital tech services exporter in the world in 2019 and this agreement will boost even more UK tech scale-ups to expand their reach on a truly global scale. Tech Nation looks forward to working with the UK government to support more UK tech companies to scale and succeed overseas.”

Giles Derrington, Head of Public Affairs at Deliveroo – UK and Ireland, said: “As a proud UK tech business with operations in a number of CPTPP member countries, it is great news that the UK is seeking to become a signatory to the deal. The agreement’s innovation and technology provisions will help facilitate digital trade for UK companies operating in places like Australia and Singapore and demonstrates the UK’s commitment to supporting companies to compete globally. The UK has an amazing tech sector that I know can achieve amazing things in these markets through the closer partnerships CPTPP can help create.”