The UK government has ratified the terms of the agreement to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) “earlier than expected”, it has been announced today (17 May).
For the CPTPP to enter force by the end of 2024, six other countries need to ratify the treaty. Those who have already done so include Japan, Singapore and Chile. The process is ongoing for several other countries.
It follows royal assent for the agreement earlier this year.
Benefits
Among the benefits described by the government are a cut to “red tape” for UK exports, as well as “increased flexibility” via modernised rules of origin for British goods.
The Department for Business and Trade (DBT) also says that new provisions will “limit barriers” for investment.
The CPTPP area includes 500m people and would account for 15% of world trade once the UK joins, according to DBT.
Peru agreement
The news comes as the UK also concludes a tax agreement with fellow CPTPP member Peru, the UK-Peru Double Taxation Agreement, which it says will “prevent businesses from being taxed twice and will significantly reduce the costs of doing business with Peru”, thereby offering an opportunity for “substantial increases in bilateral trade and investment”.
Bilateral trade between the UK and Peru was worth £1.8bn last year.
UK trade minister Greg Hands is in Peru today to hail the conclusion of negotiations with Peru. Speaking on the two announcements, he said:
“The UK has been racing to get our ratification done because we know how much CPTPP will benefit British businesses, whether through access to new markets or cutting red tape on existing exports.
“I’m delighted we were able to bring this forward, ahead of our original July forecast, so we can get the countdown to entry into force going as soon as possible.”
The government says the UK aims to be “an influential member of CPTPP, making its voice heard on all key matters”, including the future shape of the agreement.
'Important' stage
Marco Forgione, director general of the Institute of Export & International Trade (IOE&IT), said of the announcements:
“The ratification of CPTPP marks an important stage in the UK’s trading future. British businesses now have tariff-free access to some of fastest growing markets in the world to sell our goods and our world leading services. This is an opportunity which can help reshape the UK economy.
“At a time when global trade has been weaponised, this partnership can help the UK establish resilient and robust supply chains across Southeast Asia, Central and South America. In a world of growing geo-political uncertainty, the expanding trading community of CPTPP nations offers an important counterpoint.
“Now CPTPP is ratified the real work begins to make sure businesses understand how to take advantage of the immense opportunities for UK services and goods in CPTPP nations. There is a great opportunity for UK businesses to grow.”
