Boris ‘pride’ over Pacific trade deal
SUCCESSFUL membership of the transpacific trade bloc is “global Britain in action”, Boris Johnson said last night.
Experts say membership of the £9trillion bloc will not only boost the UK’S economy but also allow it to influence the global trading system.
This could include giving the UK a say in whether China is allowed to join the bloc – a move Beijing has requested but which senior Government figures have opposed.
UK membership of the Comprehensive and Progressive Agreement for Transpacific Partnership (CPTPP) was welcomed yesterday, with Mr Johnson saying: “I’m proud that the UK will be the first European country to join.this is free trading global Britain in action.”
In the short term, joining the bloc is expected to provide an 0.08 per cent boost to GDP – £2billion by today’s calculations.
However the long-term economic gains could dwarf those of the EU’S single market, as Britain enjoys access to a grouping which accounts for 13 per cent of the world’s income and boasts economic powerhouses like Japan and Singapore as well as fast-growing economies such asvietnam.
Business leaders predicted it could turn the UK into an investment gateway for Asia, with US and EU firms pumping billions into UK manufacturing to create goods and services eligible for export.
“There are strict rules of origin, but as long as products are made here, they count,” said Duncan Edwards, CEO of Britishamerican Business, the leading transatlantic trade organisation.
“If a US company is located in the UK and goods are made here, then they will be available to be exported to CPTPP countries with all the benefits this brings to the UK economy – and the same applies to EU firms.”
Membership will boost exports of UK digital services and niche technical and cultural
goods such as whisky, but it will also see imports of electronic goods become cheaper since tariffs will be removed.
The move is just as important on geopolitical grounds as economic, as the world’s democracies fight to offset the economic influence of China.
In February, President Xi Jinping threw down the gauntlet to capitalism when, moving away from the traditional standpoint that different systems would be allowed to compete together, he argued the Western model had failed to deliver growth, and Beijing’s own model was a better choice for all countries. It was taken as a sign China would increase its economic and political assertiveness.
Britain’s early access to the bloc means it has a say in the way it is shaped.
Liz Truss, who was trade secretary when the UK applied, said opposing China’s bid to join is “essential”, and the CPTPP was “an important counterweight to those who seek to undermine our values”.
“In particular, the CPTPP is a vital economic bulwark against China and in due course I would like to see other likeminded free-trading nations making their own applications to join,” she said.