In its recent research, the OBR anticipated that the CPTPP would have minimal impact on UK GDP. Is the CPTPP's excitement is justified?
Members of the House of Lords discussed the main objectives of the Trade (Comprehensive and Progressive Agreement for Trans-Pacific Partnership) Bill on Tuesday 21 November.
What is the aim of the Trade (Comprehensive and Progressive Agreement for Trans-Pacific Partnership) Bill?
The UK will join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, otherwise known as CPTPP. This Bill helps to make that happen. The aim of the Trade (Comprehensive and Progressive Agreement for Trans-Pacific Partnership) Bill is to ensure compliancy with international obligations when the UK joins the free-trade agreement by changing domestic rules on trade barriers, government procurement and intellectual property.
This Bill reduces complex obstacles to trade, aligning the UK's approach to copyright with other members, ensuring equal access to UK procurements for suppliers, and allowing conformity assessment bodies in other countries to apply for approval in the UK.
UK businesses will benefit from corresponding treatment in other participating countries, reducing red tape, and giving traders more certainty. This Bill will make the UK more attractive to global finance and benefit British consumers, who will enjoy cheaper imports, better choice, and higher quality products
Why is the CPTPP trade agreement beneficial to the UK?
"This is an age of rapid growth in the Indo-Pacific region, and the political shifts we face are the first reason to support this Bill. Countries in the Indo-Pacific are expected to drive the majority of global growth between now and 2050. I want to continue this Government’s work to deepen our relationships with this region and support shared security and prosperity". Lord Cameron of Chipping Norton
According to Cameroon, joining a global trade area is vital for the UK, putting the UK at the center of a group of dynamic economies. This will help tackle climate change, diversify the UK'S supply chains, and boost economic resilience.
15% of Global GDP
As CPTPP members, the UK will join 11 countries with a GDP of nearly £12tn, making up 15% of the global GDP, giving British companies access to new markets.
99% UK Exports to be tariff free
It means more than 99% of the UK's current exports to other members become eligible for tariff-free trade.
The OBR'S Autumn 2023 report
The Office for Budget Responsibility (OBR), in its recent report, has indicated that the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) is expected to have a negligible impact on the UK's Gross Domestic Product (GDP). Given this, it is worth considering whether the current level of excitement surrounding the CPTPP is justified. According to a study by the Office for Budget Responsibility (OBR), joining the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) will only increase the UK's GDP by 0.04% after 15 years of membership.
The UK'S FTA with New Zealand and Australia
The OBR also estimates that two trade deals with Australia and New Zealand could raise the UK's real GDP by a combined total of 0.1% by 2035.
The Brexit Loss....100 times bigger than the CPTPP gain
However, the small gains expected from these trade deals do not offset the fact that the UK economy will be 4% smaller than it would have been if the UK had remained in the EU. The government previously stated that joining the CPTPP would add between 0.08% and 1% to GDP.
What is the CPTPP?
The CPTPP is a free trade deal (FTA) between 11 countries: Australia, Brunei Darussalam, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam. The UK agreed to join on July 16, 2023, but approval from each of the other countries that are already part of the agreement is needed before the UK can join.
CPTPP - Wrong priorities !?!
Arne Mielken, the customs and global trade expert and MD of Customs Manager Ltd, believes that the UK's membership in the CPTPP has been hugely overhyped. In his opinion, the UK should focus on improving trade with the EU, which has slowed down since Brexit, as the UK has left the single market and the customs union.
Lord Cameron's CPTPP remarks
In his first speech in the House of Lords, Foreign Minister David Cameron called the UK's upcoming membership in the CPTPP the "next vital step" in a policy that would place the UK at the centre of some of the world's most dynamic economies. Watch his speech here:
Lord Cameron of Chipping Norton (Conservative), Foreign Secretary, opened the debate in his maiden speech in the Lords:
'This is an age of rapid growth in the Indo-Pacific region, and the political shifts we face are the first reason to support this bill. Countries in the Indo-Pacific are expected to drive the majority of global growth between now and 2050. I want to continue this government’s work to deepen our relationships with this region and support shared security and prosperity.'
More Information and Links
CPTPP - Rules of Origin - Legal Text
Find here the legal text on the Rules of Origin under the Comprehensive and Progressive Agreement for the Trans-Pacific Partnership, CPTPP.
CPTPP: Membership perks for British Exporters !?!
Will the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) truly benefit British exporters? What are the UK CPTPP membership perks? We explore.
CPTPP: What benefits for my Industry?
We look at the construction, life science, food & drink and manufacturing sectors and explore how they can benefit from CPTPP.
Unlocking the Benefits: CPTPP - Rules of Origin
We are covering the Comprehensive and Progressive Agreement for the Trans-Pacific Partnership, CPTPP, we will break down all the relevant provisions of the Free Trade Agreement. Let's focus on Rules of Origin.
Need help with Rules of Origin or maximising users of Free Trade Agreements?
Get in touch, we have many years of experience in saving companies lots of money
Comentários