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Britain Signs Trade Deal to Join Indo-Pacific CPTPP Bloc
Britain's Accession to the CPTPP
Britain's business and trade secretary, Kemi Badenoch, has officially signed a treaty confirming Britain's accession to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) bloc. This is the largest trade deal for Britain post-Brexit. The deal was signed in New Zealand and will now undergo parliamentary scrutiny in the UK, while other CPTPP nations will also complete their own legislative processes.
Benefits of the CPTPP Deal
According to the UK government, over 99% of current UK goods exported to CPTPP countries will soon be eligible for zero tariffs. The CPTPP includes countries such as Canada, Mexico, Japan, Australia, Vietnam, Singapore, and Malaysia. The UK would become the first European nation to join the bloc, which is expected to unlock trade opportunities to a region with a total GDP of £12 trillion ($15.7 trillion).
Impact on Britain's Growth Prospects
While the CPTPP deal is seen as a significant milestone for Britain, its actual impact on the country's growth prospects remains uncertain. The UK government's own estimates suggest that the deal will only raise long-term domestic GDP by 0.08%. This may have little impact in offsetting the trade losses that resulted from Brexit.
Britain's Independent Trading Nation
In light of the deal, Badenoch emphasized that Britain is using its status as an independent trading nation to join an "exciting, growing, forward-looking trade bloc." She believes that joining the CPTPP will help grow the UK economy and further support the hundreds of thousands of jobs that businesses owned by CPTPP nations already provide in the country. According to government data from 2019, one in every 100 workers in Britain was employed by a business headquartered in a CPTPP nation.
Opportunities and Access to Market
Badenoch also highlighted the opportunities and access to a market of over 500 million people that the CPTPP deal will provide for Britain. The trade pact originated from the now-defunct Trans-Pacific Partnership (TPP) that initially included the United States but fell apart when former President Donald Trump decided to withdraw US involvement.
In conclusion, Britain's accession to the Indo-Pacific CPTPP bloc is a significant development in post-Brexit trade. While the exact impact on Britain's growth prospects remains uncertain, the deal offers opportunities for increased trade and access to a vast market. Joining the CPTPP aligns with Britain's vision of being an independent trading nation and opens up new avenues for economic growth and job creation.
A Hot Take on the Impact of Britain's CPTPP Membership for New Businesses
An Exciting Opportunity for New Businesses in the UK
Britain's recent accession to the CPTPP bloc presents an exciting opportunity for new businesses in the country. By joining this comprehensive trade agreement, the UK gains access to a market of over 500 million people and establishes itself as the first European nation to be part of this prominent trade bloc. This membership opens up new avenues for economic growth, job creation, and increased trade potential.
Unlocking Trade Opportunities
For new businesses, the CPTPP provides significant benefits. With over 99% of current UK goods exported to CPTPP countries eligible for zero tariffs, new businesses can enjoy smoother and more cost-effective trade with these nations. The inclusion of countries such as Canada, Mexico, Japan, and Australia offers diverse and lucrative markets for businesses to tap into, expanding their customer base and revenue potential.
Challenges to Consider
However, it is important for new businesses to approach this opportunity with caution. While joining the CPTPP aligns with the vision of Britain as an independent trading nation, the actual impact on the country's growth prospects remains uncertain. The UK government's own estimates suggest a modest increase in long-term domestic GDP, which may not fully offset losses resulting from Brexit.
Adapting and Seizing Opportunities
To make the most of this development, new businesses should focus on adapting to the changing trade landscape and seizing the opportunities presented by the CPTPP membership. This might involve understanding the specific needs and preferences of CPTPP member countries, adapting product offerings, and building strong international partnerships to establish a foothold in these new markets.
Continued Evaluation and Flexibility
As the CPTPP deal undergoes parliamentary scrutiny and legislative processes, new business owners should closely monitor developments and adjust their strategies accordingly. Furthermore, staying informed about any potential changes or amendments to the trade agreement is crucial to ensure continued compliance and competitiveness within the CPTPP bloc.
In summary, Britain's accession to the CPTPP offers new businesses an exciting opportunity to tap into diverse markets, expand trade opportunities, and foster economic growth. However, it is essential for new businesses to approach this opportunity with careful consideration and adaptability in order to navigate potential challenges and fully utilize the benefits of this trade agreement. By staying proactive and flexible, new businesses can position themselves for success in the evolving post-Brexit trade landscape.
Article First Published at: https://www.cnbc.com/2023/07/16/britain-signs-deal-to-join-12-trillion-indo-pacific-trade-bloc.html