The United Kingdom is set to link up with an Asia-Pacific trading bloc.
On Tuesday, Japanese Economy Minister Yasutoshi Nishimura said member nations of the Asia-Pacific trading bloc agreed to let the former European Union state begin the process of joining the 11-nation group spanning Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam.
Originally known as the Trans-Pacific Partnership (TPP), the Asia-Pacific free trade agreement under then-President Barack Obama once counted the U.S. as a member, but former President Donald Trump withdrew from the pact in 2017. Since then, the TPP has evolved into the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).
The U.K. has hammering out new trade deals following its blockbuster Brexit breakup with the European Union. It asked to join the bloc in February, with the application just starting, it might not gain entry into the CPTPP until next year.
It wasn’t immediately clear how much of a benefit the U.K. would see from membership by way of border taxes, since it already has in place trade agreements with seven CPTPP member nations, and it is in talks with Australia and New Zealand for separate bilateral trade deals. But once a member, the U.K. could see future benefits as more countries join.
In early May, U.S. Secretary of State Antony Blinken said during a BBC radio broadcast that a deal between the U.S. and U.K. could be years away. But the two could forge a trade pact within a larger bloc.
Under President Joe Biden, the U.S. has already rejoined the Paris Agreement and the World Health Organization, and there’s been speculation over whether the U.S. would rejoin the CPTPP. At the Sourcing Journal Hong Kong Summit last month, Jonathan Gold, vice president for supply chain and customs policy at retail trade group the National Retail Federation, said Biden hasn’t ruled out coming aboard with the CPTPP, but “it would have to be on U.S. terms.” NRF hopes the U.S. would rejoin the pact because it would improve national trade leadership and facilitate China trade-related issues, he said.
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Meanwhile, as the U.K. and a working group from the CPTPP begin talks, much of the focus will be centered on tariffs, as well as a set of rules for trade and investment.
International trade secretary Liz Truss described the start of the accession process as “excellent news,” according to the BBC. She said the government would present plans to Parliament before starting talks with the CPTPP working group.
“It will help shift our economic [center] of gravity away from Europe towards faster-growing parts of the world, and deepen our access to massive consumer markets in the Asia Pacific,” Truss said. “We would get all the benefits of joining a high-standards free-trade area, but without having to cede control of our borders, money or laws.”