UK’s Kemi Badenoch seals trade deal with massive bloc in the early hours of this morning

Business and Trade Secretary formally signed the treaty confirming UK’s accession to CPTPP
– the Indo-Pacific trade bloc now worth £12 trillion in GDP

Montage © Facts4EU.Org 2023

Facts4EU.Org celebrates a major milestone in our new-found Brexit freedoms

The ink is now dry on the signature of Business and Trade Secretary Kemi Badenoch, who formally signed the treaty to accede to the CPTPP trade group in Auckland in the early hours of Sunday morning, UK time.

Membership of the trade group is expected to spark further investment in the UK by CPTPP countries, already worth £182 billion in 2021, by guaranteeing protections for investors.

And then there were 12! Delighted to welcome the United Kingdom to the CPTPP. 🇬🇧joining 🇳🇿🇦🇺🇧🇳🇨🇦🇨🇱🇯🇵🇲🇾🇲🇽🇵🇪🇸🇬🇻🇳. NZ is committed to the rules-based trading system and to the CPTPP remaining open and dynamic. #CPTPP2023 👉 https://t.co/qKjrd0qhLK pic.twitter.com/XYpxJ23WHT
— Damien O'Connor (@DamienOConnorMP) July 16, 2023

Brexit Facts4EU.Org Summary

The signing with CPTPP - what does it mean?

United Kingdom is first non-founder member to be allowed to join
No free movement, no CPTPP laws imposed on the UK, no political union
Unlike the EU this is a trading bloc
99% of UK goods exports to CPTPP to be eligible for zero tariffs
UK businesses given unparalleled access to market of over 515 million people
None of this would have been possible without Brexit

The signing comes as a new government report reveals one in every 100 UK workers was employed by a business head-quartered in a CPTPP member nation in 2019, equating to over 400,000 jobs across the country.

Speaking just ahead of the signing, the Rt Hon Kemi Badenoch MP said:

“I’m delighted to be here in New Zealand to sign a deal that will be a big boost for British businesses and deliver billions of pounds in additional trade, as well as open up huge opportunities and unparalleled access to a market of over 500 million people.
“We are using our status as an independent trading nation to join an exciting, growing, forward-looking trade bloc, which will help grow the UK economy and build on the hundreds of thousands of jobs CPTPP-owned businesses already support up and down the country.”
- Business and Trade Secretary, Sun 16 Jul 2023

Don’t let the negative BBC diminish this great achievement today

Brexit Facts4EU.Org Summary

The report found CPTPP investment accounted for:

A market of over 515 million consumers - far more than the EU
Over £240 billion in turnover in London, £35 billion in the South East and £18 billion in the East of England
The creation of 26,000 jobs in 2021 and 2022
75% of all employment in CPTPP-owned businesses was outside of London
One in 50 jobs in the North East
One in every 25 jobs in the manufacturing sector

[Sources : GDP and population data refers to data from 2022 and is taken from IMF World Economic Outlook Database, April 2023 edition.]

The report also found that CPTPP companies punch above their weight economically. While they account for 0.3% of all businesses in the UK, they generate 6.1% of the UK’s total turnover - 20 times higher than the proportion of businesses they represent.

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An impossible deal without Brexit enabling it

The UK will be the first European member and first new member since CPTPP was created, which would have been impossible had we remained in the EU. With the UK as a member, CPTPP will have a combined GDP of £12 trillion and account for 15% of global GDP.

Being part of CPTPP will mean that more than 99 per cent of current UK goods exports to CPTPP countries will be eligible for zero tariffs. Dairy farmers, for example, will benefit from reduced tariffs on cheese and butter exports to Canada, Chile, Japan and Mexico. This builds on the £23.9 million worth of dairy products we exported to these countries in 2022.

Importantly, the agreement is a gateway to the wider Indo-Pacific which is set to account for the majority of global growth and around half of the world’s middle-class consumers in the decades to come, bringing new opportunities for British businesses and supporting jobs.

This deal liberates services – the UK’s speciality

When it comes to trade deals, the BBC and the government’s agencies such as the Office for Budget Responsibility and HM Treasury seem not to understand that international agreements such as CPTPP are not solely about trade in goods.

Yes, tariff-free access to international markets for UK manufacturers is valuable but the UK’s economy is 80% based on services. One of the benefits of the new CPTPP deal is the liberalisation of the restraints on the UK’s services sector in being able to sell into one of the fastest-growing markets in the world. Here is what No.10 said :-

“Boosting services: The UK is the world’s second largest services provider and services accounted for 43% of our trade with CPTPP members last year. Joining the bloc will slash red tape – UK firms will not be required to establish a local office or be resident to supply a service and will be able to operate on a par with local firms.
“Increased flexibility: Modern ‘rules of origin’ could make British businesses more competitive by allowing them to trade more freely across the bloc. For example, UK car manufacturers could sell car engines tariff-free to a car maker in the bloc who could then sell those cars tariff-free to any member country. This is currently not possible under all the bilateral trade agreements the UK has in place with CPTPP members and will help exporters diversify their supply chains and create new export opportunities.
“Pro-investment: Investment between the UK and CPTPP countries is expected to increase as the agreement contains provisions to limit barriers and encourage more inward investment. Inward investment stocks to the UK from CPTPP countries were worth £182 billion in 2021.
“Cutting-edge: Remotely delivered services from the UK to CPTPP were worth £20.5 billion in 2020. CPTPP sets modern rules for digital trade across all sectors of the economy and will support UK businesses of all sizes to seek new opportunities in CPTPP markets.”
No.10 statement, 31 Mar 2023

Liz Truss also deserves credit for starting this deal, over two years ago

Commenting on our reports, Liz Truss told us :-

"As Trade Secretary, I made our formal application to join CPTPP two years ago. I am delighted negotiations are completed, deepening UK access to some of the world's fastest-growing economies. This is Global Britain in action and an important counterweight to those who seek to undermine our values.
"I’d like to pay tribute to all those at the Department for International Trade who put in the hard yards to make this happen. This is a vital development as we seek to boost UK exports to new markets and deliver additional economic growth."
- The Rt Hon Liz Truss MP, former International Trade Secretary, former Prime Minister

During her tenure as International Trade Secretary the Rt Hon Liz Truss MP criss-crossed the globe, promoting British business and initiating trade discussions. Many times we reported positively on her work and it was clear that her enthusiasm for the promotion of post-Brexit Britain was well-received internationally.

Observations

What great news for a Sunday morning. We have no doubt the BBC will pour cold water on this today but the simple fact is that this deal, now signed, significantly increases the influence of the United Kingdom in the Indo-Pacific and globally.

The UK may have left the EU empire but it still trades with it. Now in addition the UK has now signed a deal with a trading bloc of over 582 million consumers with the UK – making it over 135 million more than that of the EU once the UK formally acceeds.

Whichever way Rejoiners choose to spin and belittle this, the CPTPP deal represents another major Brexit benefit.

And finally, regular readers know we sometimes post a music video on Sundays. Here's the great Antipodean band Crowded House, with its lead singer from New Zealand, other band members Australian. It's uplifting and seemed appropriate somehow.

(Dedicated to the memory of Nick Hester, RIP.)

We must get reports like this out there

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[ Sources: HMG | UK Dept for Business and Trade | NZ Ministry of Foreign Affairs and Trade (MFAT) | UN | Eurostat ] Politicians and journalists can contact us for details, as ever.

Brexit Facts4EU.Org, Sun 16 Jul 2023

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Reader Comments 27

1. terence patrick hewett , Sunday, July 16, 2023, 05:43:

The UK officially joins the CPTPP in Auckland, New Zealand. And that is officially the end of rejoiniac hopes. A rejoiner govt may try stealth, but nothing that can't be reversed, and it will be fought all the way. It's the end of the road for the loony religious nut-cult of UK/EU membership. What is important, in the light of the Ukraine conflict, is the movement of EU power eastwards, to Visegrad: if the EU pushes Poland too far, will Visegrad decide to ditch the EU and join the CPTPP?

2. Sparky , Sunday, July 16, 2023, 06:30:

Joining CPTPP is about headlines to try to prove Brexit is working.
.
But let's not get carried away. CPTPP currently has 11 members, the UK already has FTA with 9 of them, most of the FTA's were rollover deals after leaving the EU. The DTI estimated that joining CPTPP could increase UK GDP by 0.08%. These countries are around the Pacific hence the title Trans Pacific and therefore a long distance away and in very different time zones to the UK. This is a compromise deal for not achieving an FTA with the USA who withdrew from joining CPTPP.
.
CPTPP may grow in the future and has potential to be significant but not yet. Maybe this is what JRM meant when he said it could take 50 years to see the benefits of Brexit.

3. Captain Thunderbolt , Sunday, July 16, 2023, 07:12:

2. Sparky
This is a compromise deal for not achieving an FTA with the USA who withdrew from joining CPTPP.
-**
No compromise at all, you said it yourself the UK already has deals with 9 of them which are bilateral trade deals difference here is CPTPP is a trade block which was the reason most voted for back in 73.
One also has to take into account the trade deals become a Multilateral trade where rules of origin if trade goes through all the CPTPP Rules of origin is relaxed as it member countries trade.
*********
CPTPP may grow in the future and has potential to be significant but not yet. Maybe this is what JRM meant when he said it could take 50 years to see the benefits of Brexit.
**
The UK will be seeing benefits for well over 50 years. as long as the next government doesn't do anything stupid.

4. ste , Sunday, July 16, 2023, 08:13:

Great report, and great news !, I just hope this is part way of the path of our politicians putting the UK first , rather than handing power to unelected unaccountable bodies!

5. William Davison , Sunday, July 16, 2023, 09:15:

This is a punt, it will be many years before we know whether this deal will be beneficial to the UK, or not. But I suppose they have to be seen to be doing something before they lose next year's General Election.

6. LuxuryBalloon , Sunday, July 16, 2023, 09:18:

Joining and benefiting from the CPTPP could never have happened if we were still members of the EU.

7. Gazzablack , Sunday, July 16, 2023, 09:37:

2, sparkless
.
It's not accurate to say the 9 deals we had with CPTPP members were mostly rollover deals.
The EU only had FTA's with Canada, Mexico, Japan and Peru.
(Agreement on modernising the trade aspect of the Mexico deal was reached only in 2018)
It had an 'association agreement with Chile, not an FTA
It's deals with Singapore and Vietnam only came into force after the UK had left the EU
It's agreement with Peru is described as being 'provisionally Applied '
It had no deals with Australia, Brunei, Malysia, and New Zealand
.
So there was only a maximum of 4 rollover deals, 3 of which the UK has been negotiating bilateral replacements for, as they excluded the areas of particular benefit to the UK.

8. NH , Sunday, July 16, 2023, 10:24:

2. Sparky , "Trans Pacific and therefore a long distance away"
.
Your understanding of modern trade and manufacturing is 50 years out of date. Look at what you buy and see where it has come from. If you but from a European company the chances are it has been manufactured at the other side of the world. Modern manufacturing is very fractional involving components and services that have been sourced from all over the world. This allows companies to produce the best products in a cost effective efficient manner.
.
2. Sparky , "This is a compromise deal for not achieving an FTA with the USA"
.
You seem desperate to hang onto this without looking at the facts. We trade very well with the USA. This trade is growing very rapidly and we have a significant surplus. If we contrast this with our pre Brexit EU trade, our exports were growing very slowly and the deficit is out of control reaching -£91.9 Billion. You can not create wealth with this size of deficit.
.
In 1999 55% of our exports went to the EU, in 2019 this had declined to 42% of our exports. This is because growth in non-EU exports was very rapid and growth in exports to the EU was low. If pre Brexit trends continue it will not be too long before UK exports to the USA exceed our exports to the EU. This is without the Free Trade Agreement that you believe is essential.

9. Not4EU, London , Sunday, July 16, 2023, 10:30:

One of the things that brings a smile to my face this morning, and will compound the angst of the pro-EU shills, is that when the EU manages to agree a trade deal with the CPTPP it will be making an agreement with us...

10. NH , Sunday, July 16, 2023, 10:44:

5. William Davidson , "This is a punt, it will be many years before we know whether this deal will be beneficial to the UK"
.
We already know this will be beneficial to the UK because the majority of our present trade with the CPTPP is high value service trade. The UK excels in service trade but we have never had a trading agreement with the EU that includes services. As mentioned above (7. Gazzablack) our trading terms will be improved and the UK's presence in the CPTPP makes it more attractive for other countries to join. The agreement will allow the UK to exploit it's strengths in high growth areas such as Digital Trade which we could never do in the EU. This is trading agreement the suits the way the world is moving not one that's trying to hang on to the past with protectionism.

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UK’s Kemi Badenoch seals trade deal with massive bloc in the early hours of this morning

Business and Trade Secretary formally signed the treaty confirming UK’s accession to CPTPP– the Indo-Pacific trade bloc now worth £12 trillion in GDP

Facts4EU.Org celebrates a major milestone in our new-found Brexit freedoms

Brexit Facts4EU.Org Summary

Don’t let the negative BBC diminish this great achievement today

Brexit Facts4EU.Org Summary

An impossible deal without Brexit enabling it

This deal liberates services – the UK’s speciality

Liz Truss also deserves credit for starting this deal, over two years ago

Observations

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Paypal Users Only - Choose amount first

Reader Comments 27

1. terence patrick hewett , Sunday, July 16, 2023, 05:43:

2. Sparky , Sunday, July 16, 2023, 06:30:

3. Captain Thunderbolt , Sunday, July 16, 2023, 07:12:

4. ste , Sunday, July 16, 2023, 08:13:

5. William Davison , Sunday, July 16, 2023, 09:15:

6. LuxuryBalloon , Sunday, July 16, 2023, 09:18:

7. Gazzablack , Sunday, July 16, 2023, 09:37:

8. NH , Sunday, July 16, 2023, 10:24:

9. Not4EU, London , Sunday, July 16, 2023, 10:30:

10. NH , Sunday, July 16, 2023, 10:44:

Business and Trade Secretary formally signed the treaty confirming UK’s accession to CPTPP
– the Indo-Pacific trade bloc now worth £12 trillion in GDP