The UK has joined a Pacific trade bloc, its first major trade deal since leaving the EU
— 1 minute read — By Sam Feierabend
On 1st February, the UK applied to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), a free trade area including 11 Asian and Pacific nations.
The government believes that joining the group of nations – covering a market of around 500 million people – will boost exports for the UK. Members of the agreement include Japan, Australia, New Zealand and Canada.
By joining the trade bloc, tariffs on British goods will be reduced, allowing freer and easier trade. This is particularly crucial in the Asian market, where economies are developing, a new ‘middle-class’ is being created and British products such as cars are in demand.
However, the benefits of joining the CPTPP are expected to be modest at first, given that the UK has pre-existing deals with members like New Zealand and Australia that have rolled over from EU membership.
In 2019, CPTPP nations accounted for 8.4 percent of UK exports which is roughly the same amount as exports to Germany.
Interestingly, the U.S. had held talks to join the trade bloc before the former-president, Donald Trump, withdrew from negotiations. If the Biden administration can re-open talks to join, it would allow a closer trade partnership between the UK and U.S. as there would be no need to wait for a bilateral trade deal to be agreed.