BENEFITS OF CPTPP MEMBERSHIP
The attraction to members is access to each other markets with the elimination of 95% of tariffs, with specific exceptions such as rice farming in Japan and Canadian dairy products. Importantly, sourcing goods from within the grouping will allow Rules of Origin to come into force if 70% of the products are sourced therein.
So, what is in it for the UK you may ask? Given the recent agreement with New Zealand it means that the only countries we do not already have a trade deal with are Brunei and Malaysia. Membership would allow negotiation of higher-level agreements than those already in place.
Additionally, the UK would be the 2nd largest economy in the grouping. In 2017, the CPTPP nations accounted for about £1 in every £12 of foreign investment in the UK. It is also a high-level agreement that not only reduces trade tariffs for goods, but also sets new rules in areas such as services, investment, intellectual property, digital trade, and state-owned enterprises.
The greatest hope is that other countries join the club. South Korea and the Philippines have expressed an interest. –Under its previous incarnation TPP, the US was set to join. The hope remains they may rekindle their interest, although the current administration does not seem to see this as a priority. This would be a golden ticket for the UK as the US accounts for around twice as much UK trade as the current CPTPP members.
Membership of the UK is attractive to current CPTPP members as it allows access to British expertise which will encourage modernisation of their economies. British services and the knowledge that comes with it is highly prized in many of these markets.
If the UK is successful in its application, it will be the first non-founding member to join which helps with the Global Britain vision as a forward thinking and open economy keen to trade. It is also worth mentioning that the UK shares a common language with many of the existing member states.
It is unlikely that joining the CPTPP will make a significant difference to the UK’s post-Brexit economic prospects. Joining this agreement will require the UK to make compromises that it frequently objected to when an EU member.