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The parties to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) have agreed to formally commence an accession process with the UK. Ahead of the start of formal negotiations, the UK Government has set out its strategic approach to accession.
The CPTPP is a trade agreement between 11 nations, which together accounted for 15% of global trade in 2019: Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam. It entered into force in 2018 and the UK is the first non-founding country to apply for accession. The trade agreement is wide ranging, containing 30 chapters dealing with topics such as trade in goods and services, digital trade, competition, subsidy control, intellectual property, labour and environmental standards and dispute resolution.
The government highlights the immediate economic benefits of accession, such as the removal of barriers on trade in goods and services. In particular, the UK could benefit from lower tariffs on niche luxury products such as whisky and cars, which are in high demand in the Pacific region. The trade deal has the potential to increase the competitiveness of UK businesses that export to this region and provide greater access to a growing middle class market. It also notes there is potential for further CPTPP expansion, with economies including the Philippines, Thailand, Taiwan and the Republic of Korea expressing an interest in joining, which would provide further trade opportunities to the UK.
The government’s approach to the negotiations has not been set out in detail, except to give some specific reassurances that accession would not impact the NHS, its services or the price it pays for medicines, and that the UK will continue to comply with the European Patent Convention.
The House of Lords International Agreements Committee is carrying out an enquiry into the proposed accession and has reopened its call for evidence. It has published a list of 10 specific questions, covering topics such as agricultural market access negotiations and striking a balance between opportunities in digital trade and data protection concerns. We expect there to be further discussion on these issues over the coming weeks. For example, it will be interesting to see whether the government will seek to retain any specific tariff protections or an exemption to the provisions on international data transfers so as not to risk its recently confirmed adequacy status under the EU regime.