Britain Becomes the First European Member of Indo-Pacific Trade Bloc
Britain has officially joined the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), marking a significant milestone in its post-Brexit trade strategy. This development makes Britain the first European nation to join the trade pact, which includes major economies like Japan, Australia, and Canada. The move reflects Britain’s efforts to deepen its economic ties with the Indo-Pacific region and diversify its global trade partnerships.
The CPTPP, which Britain joined as its 12th member, offers trade rules and tariff reductions with countries such as Japan, Malaysia, Vietnam, and Peru. This pact goes beyond traditional trade deals by introducing flexible "rules of origin" provisions that provide businesses with options for sourcing materials and producing goods. For Britain, the agreement represents its first free trade deals with Malaysia and Brunei while enhancing existing trade terms with other member countries.
Unlike the European Union, the CPTPP does not require regulatory harmonization or a single market structure. This makes it a strategic choice for Britain as it looks to leverage its independence from EU regulations while fostering economic collaboration with dynamic markets. However, while the CPTPP is a strategic win, its immediate economic impact is limited. The British government estimates the deal could add £2 billion ($2.5 billion) annually to the economy in the long term, accounting for less than 0.1% of GDP.
The agreement also carries geopolitical significance. As a CPTPP member, Britain now holds sway in deciding on future applications to the bloc, including those from China and Taiwan. Originally conceived as a counterbalance to China's economic influence, the CPTPP traces its roots to the U.S.-backed Trans-Pacific Partnership, which was later revived without U.S. participation under the Trump administration.
Britain’s accession comes at a time when other nations, such as Costa Rica and Indonesia, are exploring membership, potentially expanding the bloc’s reach and influence. By joining the CPTPP, Britain signals its intent to play a prominent role in shaping trade policies in the Indo-Pacific, a region of growing strategic and economic importance.
Refrence From: www.ndtv.com