Credit: Original article can be found here
Here’s a prediction: In 10 or even 20 years’ time, no reputable economist or statistician will be able to work out convincingly what economic benefit the United Kingdom gained from joining the 11-country Comprehensive and Progressive Trans-Pacific Partnership in 2023. Those 11 countries are Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam.
There is no point in wasting time arguing over whether the UK government’s own prediction of a 0.08% gain in GDP over the long term is an underestimate or an overestimate. We can’t know this now and we won’t know in the long term either.
This has little to do with whether or not those 11 countries, whose combined population is about 500 million, enjoy rapid economic growth over the next decade. Likewise with whether other economies such as Thailand or South Korea join. Whether they do or they don’t join will again make little real difference.
The main reason is that the UK already has pretty open market access to most of those countries, including as a result of free trade agreements it has struck post-Brexit with, among others, Japan, Australia, Canada, Singapore and New Zealand.
None of the three Asian giants — China, India and Indonesia — is a member.
The specific provisions of the CPTPP may benefit some exporters in the UK — as usual in free trade discussions, cheese and Scotch whisky are being highlighted — but such benefits will be too small to be detectable in what is currently a £2.2 trillion UK economy. There are just too many other forces, positive and negative, to be able to isolate such impacts.
So the argument underway on Twitter and in the op-ed columns of British newspapers is meaningless. To wax Shakespearean, we should come neither to bury Britain’s CPTPP membership nor to praise it.
To wax vulgarian, membership will in economic terms be better than a poke in the eye with a blunt stick, but that is about all that can be said. Anyone interested in the trade technicalities of the CPTPP should read this Substack piece from the excellent Sam Lowe’s Most Favoured Nation.
Anyone interested in the history of the CPTPP needs just to be reminded that what was then called the Trans-Pacific Partnership was promoted by President Barack Obama’s administration in 2008-16 but then renounced both by Hilary Clinton, Obama’s Secretary of State and then by President Donald Trump.
Following America’s withdrawal, the remaining 11 countries, led by Japan and Australia, revived the agreement, adding “comprehensive and progressive” to its name in the usual perverse indication that the arrangement had regressed and become less comprehensive.
Nonetheless, to revive and thereby retain the agreement was a major achievement for Japan and Australia. This set up the CPTPP as a rules-setting body for trade and investment in Southeast Asia and across the Pacific, and notably not a body that stood to be dominated by the biggest country in that region, China.
The original American purpose of the TPP was to entrench relatively liberal processes of rule-setting and resist the growing influence of China on such rules; the CPTPP has still succeeded in that aim even without America being a member.
But CPTPP is not the only trading game in the Indo-Pacific region: There is a complicated series of trade arrangements centered on the Association of Southeast Asian Nations (ASEAN) and South Korea, and above all there is the Regional Comprehensive Economic Partnership (RCEP) signed in 2020 by 15 Asia-Pacific countries, including Japan, Australia, Indonesia and most notably China – but again India has stayed out.
Thus, you could say, there is a regional battle for possession of the word “comprehensive”: RCEP contains more countries with a larger overall population and does cover a lot of rules, but at present it encompasses a narrower field of trade than CPTPP and leaves out any consideration of labor standards, the environment or services trade.
This is where the real point of Britain joining the CPTPP comes in. Its membership needs to be placed in the context of its increasingly close relationships with Japan and Australia on defense, deterrence in the Indo-Pacific and diplomatic support for liberal rule-setting institutions.
Both of those countries have been dead keen on the UK becoming the first new member of the CPTPP, even though neither expects any noticeable economic benefit beyond the trade deals they have already signed with the UK over the past couple of years – and even those trade deals are not seen by either party to them as economic game-changers.
They wanted Britain as the first new member so as to set a strong precedent for how countries must join, essentially as rule-takers rather than negotiating special deals for themselves. To borrow an EU term of art, new members have to accept the CPTPP’s “acquis communautaire.” The negotiations have focused on how much Britain needs to adjust its own rules — answer: not too much, since it will not now have to accept Canadian hormone-treated beef, as some warned — rather than on changes to the CPTPP itself.
As China has also applied to join, this precedent is important and valuable.
For Britain, the main gains are to make the UK even more of a valued partner for Japan and Australia and to give it a seat at an important diplomatic table in the Indo-Pacific. It is not the only such table, as RCEP shows, and there are fora such as the annual East Asia Summit at which the UK is unlikely ever to be present, so it would be a mistake to get overly excited about this. But, nonetheless, it is a good table to be at.
It is not best thought of as an anti-China table, although British membership will add a further big-country vote against China joining in the foreseeable future. More important, it is a pro-rules table, and the task before the now 12 members will be to make their world of economic rules more credible and attractive than any other in the region so that the other currently absent big economies of South Korea, Thailand, Indonesia and India find joining it irresistible.
This geopolitical gain is valuable: the more global conduct, economic and political, follows agreed rules rather than raw power the better for all our security and prosperity. It is good that Britain will contribute a little more to this. Again, though, let’s not get over-excited about this. It is a contribution, not some sort of geopolitical game-changer.
Currently an independent writer, lecturer and consultant on international affairs, Bill Emmott from 1993 to 2o06 was editor-in-chief of The Economist. This article was originally published by his Substack publication, Bill Emmott’s Global View. (Subscribe here for free to receive his posts.) It is republished by Asia Times with kind permission. Follow the author on Twitter @bill_emmott