UK eyes pacific trade deal this year
International Trade Secretary Anne-Marie Trevelyan believes the UK's application to join the 11-nation CPTPP trade bloc (Comprehensive and Progressive Agreement for Trans-Pacific Partnership) could be approved before the end of this year.
23 May 2022Ms Trevelyan made the prediction in an interview with the Financial Times after launching discussions with Mexico - which is an existing CPTPP member - over an improved bilateral trade deal.
She revealed that the UK had already completed the first part of the accession process to the bloc and said that it was “not unrealistic that we might get there by the end of the year”, adding that the group was “very enthusiastic about our application”.
Current members of the CPTPP free trade area, which was established in 2018, are Australia, Brunei, Canada, Chile, Japan, Malaysia, New Zealand, Peru, Singapore, and Vietnam, in addition to Mexico.
Talks between Ms Trevelyan and Mexico's Secretary of Economy Tatiana Clouthier are expected to lead to detailed discussions between the two sides on a much more comprehensive deal, with a particular emphasis on increasing trade in services, notably in finance and digital.
During the visit, the Mexican delegation also held meetings at the weekend with the UK's private sector, with the aim of strengthening British investment in Mexico.
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Ms Trevelyan said an enhanced trade deal with Mexico would "transform" the relationship between the countries, "making the most of the immense opportunities its dynamic business landscape and young, growing population offer".
She added: "Trade deals like this are vital to growing the economy to address the cost of living, as they support jobs, help businesses thrive and spur investment.
"We’ve already kickstarted negotiations with India and Canada and are close to joining the CPTPP free trade area, with a combined GDP of £9 trillion, of which Mexico is a key member."
Reacting to the negotiations, Lord Bilimoria, president of the Confederation of British Industry (CBI), said the government originally did a remarkable job in securing an EU continuity agreement with Mexico.
"There is now a phenomenal opportunity to strengthen our existing economic ties including in services, digital, and investment," he said.
"International trade is the foundation for economic growth. With exporters among the UK’s most profitable and innovative businesses, firms up and down the country should be seizing on the huge untapped potential globally. Finding new opportunities in emerging markets such as Mexico will be key to that success."
“We want to see an ambitious new agreement that focuses on the growing market in green trade, as well as future-proofing access for further expansion in services," he added.
“Other key factors will be effective labour mobility and business travel schemes, and reduced costs for exporters through strong digital trade provisions.
“We also want to see arrangements on rules of origin which provide manufacturers with similar flexibilities on supply chains to those currently in place, as well as the benefits of further tariff reductions.
“A modern agreement has the potential to boost opportunities in Mexico for UK exporters in a growing and exciting market – the 15th largest economy in the world in 2020.”
Trade between the countries increased by 9.2% last year and was worth £4.2 billion, according to a government spokesman in London.
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She revealed that the UK had already completed the first part of the accession process to the bloc and said that it was “not unrealistic that we might get there by the end of the year”, adding that the group was “very enthusiastic about our application”.
Current members of the CPTPP free trade area, which was established in 2018, are Australia, Brunei, Canada, Chile, Japan, Malaysia, New Zealand, Peru, Singapore, and Vietnam, in addition to Mexico.
UK could join CPTPP by the end of the year
The UK already has trade agreements with several members of the bloc and the nation's current arrangements with Mexico are based on a Brexit carry-over deal from European Union days.Talks between Ms Trevelyan and Mexico's Secretary of Economy Tatiana Clouthier are expected to lead to detailed discussions between the two sides on a much more comprehensive deal, with a particular emphasis on increasing trade in services, notably in finance and digital.
During the visit, the Mexican delegation also held meetings at the weekend with the UK's private sector, with the aim of strengthening British investment in Mexico.
Related articles:
- India Trans-Pacific top UK trade agenda
- UK launches bid to join Asia-Pacific trade part
- Japan would welcome UK to Pacific Trade Deal
Ms Trevelyan said an enhanced trade deal with Mexico would "transform" the relationship between the countries, "making the most of the immense opportunities its dynamic business landscape and young, growing population offer".
She added: "Trade deals like this are vital to growing the economy to address the cost of living, as they support jobs, help businesses thrive and spur investment.
"We’ve already kickstarted negotiations with India and Canada and are close to joining the CPTPP free trade area, with a combined GDP of £9 trillion, of which Mexico is a key member."
Reacting to the negotiations, Lord Bilimoria, president of the Confederation of British Industry (CBI), said the government originally did a remarkable job in securing an EU continuity agreement with Mexico.
"There is now a phenomenal opportunity to strengthen our existing economic ties including in services, digital, and investment," he said.
"International trade is the foundation for economic growth. With exporters among the UK’s most profitable and innovative businesses, firms up and down the country should be seizing on the huge untapped potential globally. Finding new opportunities in emerging markets such as Mexico will be key to that success."
UK already have deals with majority of the members at CPTPP
William Bain, head of trade policy at the British Chambers of Commerce, said Mexico was already a key market for some exporting firms, particularly in Northern Ireland and the NE England.“We want to see an ambitious new agreement that focuses on the growing market in green trade, as well as future-proofing access for further expansion in services," he added.
“Other key factors will be effective labour mobility and business travel schemes, and reduced costs for exporters through strong digital trade provisions.
“We also want to see arrangements on rules of origin which provide manufacturers with similar flexibilities on supply chains to those currently in place, as well as the benefits of further tariff reductions.
“A modern agreement has the potential to boost opportunities in Mexico for UK exporters in a growing and exciting market – the 15th largest economy in the world in 2020.”
Trade between the countries increased by 9.2% last year and was worth £4.2 billion, according to a government spokesman in London.
Read more news and views from David Sapsted in the Spring 2022 issue of Think Global People.
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