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The Regional Comprehensive Economic Partnership involves 12 countries, but what good are complex trade deals like this for New Zealand?
New Zealand is backing the United Kingdom as it seeks to join a huge trans-pacific trade pact.
The United Kingdom announced on Sunday its intention to formally apply to join the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP), a trade pact that grew from the ruins of the Trans-Pacific Partnership agreement after the United States withdrew from negotiations.
CPTPP members include New Zealand, Japan, Australia, Canada, Vietnam, Singapore, and Mexico.
Getty images and AP
New Zealand Prime Minister Jacinda Ardern and British Prime Minister Boris Johnson.
The UK would be the first nation to officially apply to join the pact since it came into force at the end of 2018.
UK Prime Minister Boris Johnson celebrated the move as a success of Brexit, as the UK can now negotiate its own trade deals separate from the European Union. It is already negotiating with the US, Australia, and New Zealand.
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“One year after our departure from the EU we are forging new partnerships that will bring enormous economic benefits for the people of Britain,” Johnson said.
“Applying to be the first new country to join the CPTPP demonstrates our ambition to do business on the best terms with our friends and partners all over the world and be an enthusiastic champion of global free trade.”
Trade Minister Damien O’Connor welcomed the news and said the entry of the UK would be an opportunity to set a “strong precedent”.
“New Zealand sees the CPTPP objective of maintaining and growing open, rules-based trade, as more important than ever. We believe the CPTPP can provide leadership in our region and beyond to drive post-Covid economic and trade recovery. The UK’s move to join the CPTPP underlines the Agreement’s importance in this regard,” O’Connor said.
“New Zealand has always supported the expansion of the CPTPP by those willing to meet the Agreement’s high quality, so we warmly welcome the news that the UK intends to take the formal step shortly to start this process.”
“With the UK set to be the first to make such a formal request following the entry into force of the CPTPP, it will be important to set a strong precedent which reinforces the commitment of new members to fully deliver the high standards, including on market access, that are a hallmark of the CPTPP. We look forward to discussions with the UK to achieve this outcome.”
New Zealand is already negotiating a two-way trade agreement with the UK separately. O’Connor said that free trade agreement could be a valuable stepping stone for the UK’s entry into the CPTPP.
UK International Trade Secretary Liz Truss said the CPTPP would create jobs in the UK and diversify supply chains.
Under CPTPP rules the UK’s application will be discussed by all member nations before establishing a working group to handle the matter.
The UK will need to meet the CPTPP’s standards on things like labour and environmental standards, as well as allowing a certain amount of market access.
Sam McIvor, chief executive of Beef + Lamb NZ, cautioned that the UK should first stop simply splitting in half the “tariff rate quotas” on New Zealand red meat between the EU and itself.
“The UK’s choice, alongside the European Union, to split the TRQs compromises the quality of New Zealand’s access to those markets. It sends the wrong signal about the UK’s commitment to the global rules-based trading system and open markets. We expect the UK to work constructively and urgently to find a solution that does not leave us worse off.”