Sir Keir Starmer’s government has hailed the UK becoming the first European nation to officially join an Indo-Pacific trade bloc, despite saying the impact of the deal would be “very small” less than two years earlier.
At the begining of 2023, when the UK began the processing of joining the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), he gave the trade deal a luke warm reception, pointing out that the “net contribution to our economy will be something in the order of 0.08 per cent”.
But on Sunday, his business secretary Jonathan Reynolds said the agreement would “boost trade and create opportunities for UK companies abroad”.
The UK will become the 12th country to join the trade agreement, following years of procedure, having first put in an application in early 2021.
Britain will enter into the agreement with eight of the bloc’s 11 existing members who first ratified the accession on Sunday – Japan, Singapore, Chile, New Zealand, Vietnam, Peru, Malaysia and Brunei.
It will then on Christmas Eve enter into force with Australia, who later ratified the deal.
Canada and Mexico are yet to finally rubber-stamp the UK’s membership, but it is understood that officials expect them to do so at some point in the future.
Officials hope the move could boost the economy by as much as £2bn a year compared with levels of GDP projected for 2040 without the CPTPP deal.
It is expected that the CPTPP will get larger in the coming years, and last month it was announce that Costa Rica would be the next country to work through the process of joining.
But expressing hesitance about the deal in 2023, Sir Keir had said it would be “better to have a closer relationship with the EU to go alongside it” – something he is currently pursuing with his plan to reset relations with the bloc.
Conservative leader Kemi Badenoch, who was trade secretary when the UK formally agreed to join the bloc in 2023, pointed out Sir Keir’s initial equivocation over the agreement – claiming Labour “spent the last parliament mocking our CPTPP negotiations”.
“The Conservatives delivered CPTPP – a trade deal that brings enormous benefits to everyone from British farmers to fintech and small businesses to the largest manufacturers”, she said.
“The deal places the UK in a bloc with the fastest-growing economies in the world and was a key Brexit benefit to add to our EU trade deal.
“However, joining a trade bloc is only the start. Labour spent the last parliament mocking our CPTPP negotiations, and they now have a responsibility to ensure that UK companies can make the most of this landmark deal.”
Mr Reynolds said: “Britain is uniquely placed to take advantage of exciting new markets, while strengthening existing relationships.
“Today’s news is further proof that the UK is a wonderful place to do business, with an open, outward-looking economy driving the growth people can feel in their communities.
“Agreements like this boost trade and create opportunities for UK companies abroad. This is a proven way to support jobs, raise wages and drive investment across the country, which is key to this Government’s mission to deliver economic growth.
“Our trade strategy, published next year, will finally put in place a long-term, strategic plan for international trade that helps businesses and consumers and, ultimately, grows the economy.”
The Department for Business and Trade has been contacted for comment.