EXCLUSIVE: Stunning trade success of Brexit Britain vs the EU’s stalled trade deal

UK’s new trading bloc is 4 times larger than EU’s failing deal with South America trading bloc

Montage © Facts4EU.Org 2024

As the UK prepares for the start of the huge CPTPP trade agreement, we contrast the UK’s new deal with the EU’s failed one

Today the Facts4EU.Org think-tank can reveal exclusively that the total GDP of Brexit Britain’s new trading bloc is FOUR TIMES larger than that of the EU’s stalled ‘Mercosur’ deal. In three weeks' time on 15 December, the UK’s massive trade deal with the Trans-Pacific trading bloc (CPTPP) will enter into force.

Our report last Wednesday (20 Nov 2024) highlighted the EU’s continued sloth-like progress on free trade agreements – as well as the EU pre-announcing them years earlier, when they were never in fact ‘done deals’. In today’s report we compare the UK’s deal agreed with the Trans-Pacific Partnership (CPTPP) with the EU’s failed deal with the Mercosur group of five South American countries.

The results are stark and demonstrate conclusively that Brexit Britain is doing far better than the EU when it comes to trade deals with international trading blocs.

Brexit Facts4EU.Org Summary

UK’s agreed deal with 11 Trans-Pacific countries vs. EU’s failed deal with 5 South American countries

GDP of EU’s failed target market compared to GDP of market UK is about to join

GDP of UK’s new trading bloc countries : $11.256 billion
GDP of EU’s failed trading bloc deal : $2,689 billion

[Source : World Bank data for 2023.]

Combined GDP of CPTPP countries is over FOUR TIMES that of GDP of EU’s hoped-for trading bloc

Another first for Brexit Britain

The UK is the first country in the world to join the CPTPP since its formation and will be the first member from Europe. The EU’s approaches to the CPTPP have so far been abortive and are likely to remain so.

The CPTPP is very different to the EU. This is a free trade agreement, not a customs union or a single market.

CPTPP members can pursue independent trade policies with non-CPTPP members, as the UK has already done
It does not require the UK to obey its laws, nor its foreign or defence policies
Nor does it require a massive annual membership fee to subsidise the smaller and poorer member countries
The CPTPP does not have political institutions such as a parliament or an unelected Commission, as is the case with the EU
The CPTPP deal does not seperate Northern Ireland from the rest of the United Kingdom, as the EU has done

Brexit Facts4EU.Org Summary

The countries of the UK’s CPTPP deal compared with the countries of the EU’s failed Mercosur deal

GDP of UK’s new CPTPP partners, in $'s billions

Japan : $4,617
Canada : $1,780
Australia : $1,634
Mexico : $1,327
Malaysia : $401
Singapore : $387
Viet Nam : $377
Chile : $280
Peru : $222
New Zealand : $218
Brunei Darussalam : $13
TOTAL GDP : $11,256 bn

GDP of EU’s proposed MERCOSUR partners, in $'s billions

Brazil : $1,955
Argentina : $589
Uruguay : $62
Paraguay : $44
Bolivia : $39
TOTAL GDP : $2,689 bn

[Source : World Bank data for 2023.]

UK already trades successfully with largest Mercosur country, Brazil

On Tuesday last week (19 Nov 2024) Sir Keir Starmer met the Brazilian President in Rio, for wide-ranging talks.

In a joint statement No.10 said :-

"The Prime Minister and the President celebrated the strength of the trading relationship between the UK and Brazil. Bilateral trade is at an all-time high – £11.2 billion in the last 12 months. The leaders restated their commitment to work together to continue to grow the trading relationship, boosting growth in both countries."
- No.10 statement from Rio de Janeiro, 19 Nov 2024

(Click to enlarge.)

The CPTPP versus the trade deals the UK already has in place with nine of the members

The UK already has EU-type trade agreements in place with 9 of the 11 CPTPP countries, the exceptions being Malaysia and Brunei Darussalam, and its trade deal with Vietnam is limited. Whilst Brunei has a small economy, Malaysia is much more significant. The size of its economy puts it at 5th place out of the 11 members countries.

However these existing trade agreements were ‘rolled over’ from the EU, and were always unsuitable for the UK’s economy. By continuing these, the British Government ensured there was little to no disruption in the trade with these countries when the UK left the EU. That said, like all EU trade agreements there was very little about trade in services, which represent around 81% of the UK economy.

The CPTPP deal allows for a relaxation on conditions for the UK’s exports of business services, financial services, telecommunications, insurance and pension services, intellectual property services, engineering and architectural services and cultural and recreational services. (TV shows, music, orchestras etc.) The value of all of this to British exporters should not be underestimated.

The Rt Hon Sir John Redwood, former Secretary of State, commented on our report

“The U.K. exports more services than goods. Service exports are expanding much faster than goods. Given the pace of rundown of our key industries under current policies of dear energy and bans on oil and gas extraction and petrol and diesel cars, our goods exports will be hit more.
”Three leading categories of goods exports are oil, refined oil products and cars. They are all set for reductions under the Government’s net zero plans.
”That is why it is great news our new trade deals include better provision for services and now extend to the huge CPTPP trading bloc.”
- The Rt Hon Sir John Redwood, 25 Nov 2024

Regarding goods, the CPTPP has liberalised tariffs among its participants and has one set of Rules of Origin which allows for accumulation of content from other CPTPP members, when calculating if a product has enough CPTPP content to be exported tariff-free to other CPTPP members.

This is very important for UK exports. For example a UK fashion company that uses wool or cotton produced in Australia and/or made into cloth in Malaysia and/or made into clothes in Vietnam, could sell those goods in Japan or Canada or any other CPTPP country at the CPTPP preferential tariff rate.

Observations

The CPTPP’s standard terms are much more suited to the British economy

As usual, our pro-EU and anti-Brexit civil servants have been predicting very little benefit to the UK in joining the CPTPP. We suggest this is because they are ideologically opposed and because none of them have ever actually worked in exports.

In addition to the trade benefits, there are geo-political advantages in this significant success for Brexit Britain. Being part of the CPTPP raises the profile of the United Kingdom in countries which are amongst the fastest-growing in the world. With tensions rising in various parts of the world, the UK needs to have a presence and the CPTPP provides this.

French farmers seem to be seeing off EU’s 25 year-attempt to get a deal with Mercosur countries

The noises out of the French government are becoming louder and more uncompromising. Under severe pressure domestically from France’s farmers, President Macron, Prime Minister Barnier, and ministers in his government are voicing ever stronger opposition to the EU Commission’s plans to impose a Mercosur trade deal on member countries.

Even the typical ‘fudge’ by the EU Commission in order to get a deal agreed will first mean many more months of negotiation with the five South American countries – and with France and a few other EU countries. It is even possible that the South Americans will react like Australia did last year, and simply walk out.

Meanwhile, in less than three weeks’ time the United Kingdom will formally accede to the massive CPTPP trading bloc. No ‘ever closer union’, no imposition of foreign laws, no massive annual payments.

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Brexit Facts4EU.Org, Wed 27 Nov 2024

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Reader Comments 14

1. Ashley Great Britain , Wednesday, November 27, 2024, 07:06:

I'll get in before sparky says CPTPP will only contribute 00.0008% to the UK economy, predicted of course by all remain establishment's.
-
The CPTPP can't come soon enough, not only will it bring great opportunities it will also shield us more from the EU. There'll be no going back.
Opening trade and connection doors with these countries brings mutual benefit that far outweighs trade alone.

2. Sparky , Wednesday, November 27, 2024, 07:14:

4.00% - 0.08% = ?

3. Ashley Great Britain , Wednesday, November 27, 2024, 07:15:

27%

4. Gazzablack , Wednesday, November 27, 2024, 08:03:

2, sparkless
.
Myth vs Conservative estimate
.
Also
.
Annual exorbitant fee vs No fee

5. Have You Wondered , Wednesday, November 27, 2024, 09:03:

.
The biggest benefit is the UK is not waiting circa 25yrs to wrap up a trade deal - if it does get signed off. (Did the Eu's Von der Leyen not try to buy off the South Americans with €45 billion of EU taxpayers money to get it over the line?) being over ridden with EU bureaucracy, poltical expansionism, empire building and - yes you guessed it !.....
.
Why does the UK (or any other nation) need another level of corruption and malfeasance above that which the UK has already?
.

6. Have You Wondered , Wednesday, November 27, 2024, 09:23:

.
Oh oh ! Just reading todays European headlines:
"SOUTH AMERICA DEAL ON THE ROPES, AS POLAND SAYS NO"
"Paris is dead set against the EU’s pending trade deal with the so-called Mercosur bloc of South American countries"
.
Secondly, when I say : Why does the UK (or any other nation) need another level of corruption and malfeasance above that which the UK has already?
Here's a possible example?
.
Civil Servant “Forced to Resign for Supporting Reform on Facebook” "Despite the posts being on her personal Facebook account — which made no reference to her work or employers — Cochrane was told in August that she would face a disciplinary hearing."
.
The Govt. espousing free speech - unless........................
.

7. Gazzablack , Wednesday, November 27, 2024, 11:45:

6, HYW
.
Someone in the Starmer press office is dyslexic.
.
They've issued a press release saying they are introducing a bill to make "spiking" illegal.
It was supposed to say they are making "speaking" illegal.
.
Starmer of course eschewed the opportunity to travel to Wales to show support to those affected by storm Bert, choosing instead to remain at Westminster to push through his "spiking bill", and make use of his freebie Arsenal football tickets of course.

8. terence patrick hewett , Wednesday, November 27, 2024, 12:00:

The EU now is set up to split. Between those countries who will side with the US, and those countries who will go down with the "unsinkable" Franco-German Titanic. It's what you get, when you have political union before fiscal union.

9. LuxuryBalloon , Wednesday, November 27, 2024, 12:34:

I am struggling to see how the CPTPP trade deal will address the outstanding Brexit issues:
1/ NI is now a colony of the EU.
2/ EU fishermen still fishing in our waters … and our own fishermen are struggling to sell fish within the EU.
3/ Brexit has created an unfair advantage for EU exporters to the UK. While UK exporters to the EU have to deal with EU export controls, the UK seems to delay the export controls on EU goods coming into the UK time and again. Our trade deficit with the EU has increased since Brexit … not reduced.
4/ Our debt as a percentage of GDP is increasing … not decreasing.
5/ The number of illegal immigrants crossing the channel on dinghies has increased exponentially since we left the EU.

10. Gazzablack , Wednesday, November 27, 2024, 14:35:

9, LB
.
And what connection does the CPTPP have to all that?

14 comments, page 1 of 2

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