CPTPP: opportunities and challenges for the UK – Report Summary

This is a House of Commons Committee report, with recommendations to government. The Government has two months to respond.

Author: International Trade Committee

Related inquiry: UK trade negotiations: CPTPP accession

Date Published: 25 April 2023

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Summary

We launched our inquiry into the UK’s accession to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) in November 2021. We had intended to report our findings to the House later in 2023, following examination of the UK’s terms of accession. However, reorganisation of the House’s Select Committees to mirror changes to the machinery of Government has necessitated us making our incomplete findings available to the House.

The UK has free trade agreements (FTAs) with nine of the eleven parties to the CPTPP. A key line of enquiry has therefore been to determine what accession to the CPTPP offers over bilateral FTAs with the remaining two countries. We began to examine gains in goods and services, and how the agreement’s rules help improve the baseline of the trading environment. We have been unable to complete this inquiry and it is therefore difficult for us to provide a full estimate of these benefits. However, we note that there are clearly important areas where the CPTPP goes further than some existing agreements, including generous rules of origin, and prohibition of the requirement to maintain a local presence to deliver services.

It was suggested that the CPTPP could play a role in helping to shape trading rules and norms. Although our evidence is incomplete, there are areas on digital trade and the environment where the CPTPP has contributed to progress in multilateral fora. There are clear advantages in the UK contributing to these efforts, particularly as like-minded partners are turning to plurilateral blocs, rather than the lignified World Trade Organization, for digital and environmental policy innovation.

There are also opportunities within the CPTPP for the UK to show leadership and expertise, particularly in digital trade and environmental policy, where the UK has proven to be a global leader. It also needs to ensure that the CPTPP’s structures support the UK’s agenda by calling for a permanent CPTPP secretariat that can support enlargement and modification of the agreement.

The UK’s accession to the CPTPP also comes with a set of challenges. Witnesses raised issues with the agreement’s provisions for investment protection, intellectual property requirements, and food standards and animal welfare. The parts of the CPTPP which affect these areas are seemingly small and technical, but misalignment of these provisions with current practices in the UK could jeopardise important public policy aims and damage business confidence.

The Government has stated that the benefits of UK accession to the CPTPP will be amplified as new members join. However, it is also true that the accession of new members could amplify some of the challenges for the UK. In particular, we looked at the impact China’s accession could have on the CPTPP’s high standards; a risk which, though significant, the UK will be well placed to address given that accession to the CPTPP comes with the power of veto over prospective new members. However, before it assesses the merits of new applicants, the Government needs to outline as part of a single, comprehensive trade strategy how it intends to use its trade policy to achieve its broader strategic goals.