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The UK’s freight and logistics sector has welcomed news that the UK has joined the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) trade deal although they say it won’t be a “game changer”.
The CPTPP covers 500m people across Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam and will reduce tariffs on a wide range of goods.
It is estimated that joining will boost the UK economy by £1.8bn, although this represents only around 0.08% of the UK’s economy.
The trade deal took 21 months to negotiate and is the UK’s biggest trade deal since Brexit.
One World Express chief executive Atul Bhakta said: “The UK has been crying out for major trade deals for two years now. This is what was promised in the aftermath of Brexit, but it has taken a long time for meaningful trade agreements to be formed, either with major global powers or sizeable trading blocs.
“Now, we have to be realistic about how significant this particular deal will be. After all, the Government itself predicts a boost to the economy by £1.8bn; in other words, increase its size by less than 0.1%. It is clearly not a game-changer, and no doubt critics will be quick to jump on that.
“But, that said, opening up access to a market of 500m people, with many goods free from tariffs, this trade deal should not be derided. The UK is the first European nation to join the CPTPP.
“It will undoubtedly open up new opportunities for British businesses to export globally, and anything that reduces red tape and helps the export market should be celebrated. It might not be a landmark deal for the UK, but it is one that should be welcomed all the same – it is an important step in the creation of the UK as a post-Brexit trading powerhouse.”
Kate Jennings, Logistics UK’s director of policy, also felt the trade deal may “only yield small benefits” in the short term.
However, she added: “The access to innovation and increased productivity which the deal will deliver longer term will be of benefit to the overall health of the UK economy. As a nation with longstanding and excellent trading links worldwide, UK PLC stands ready to benefit from the opportunities the new agreement will provide thanks to the country’s interconnected supply chain.
“The success of the agreement will stand on improved access to high growth markets including simplification of customs processes and future opportunities to digitise the movement of goods to speed connections between the UK and the 11 nations involved.”
Steve Parker director general of forwarder group BIFA also welcomed the news.
“If imminent membership of the CPTPP delivers the boost for economic growth and geopolitical relations that the Government anticipates, it will be welcome news for BIFA members that are responsible for the freight forwarding and logistics services that underpin much of Britain’s visible import and export trade,” he said.
“BIFA looks forward to supporting its members as they seek to benefit from any opportunities the new agreement may bring, which will depend on how the improved access to the 11 high growth nations that are involved is achieved.”
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