The government has signed an agreement to join an Indo-Pacific trading bloc, although the estimated benefit could only be £1.8bn in GDP.
In announcing the formal plans to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, the Rishi Sunak administration highlighted the £12trn value of the combined GDPs of all the member nations if the UK is included.
But the government already has free-trade deals with all the member nations, aside from Brunei and Malaysia.
Chances of a trade deal with the United States were also talked down as being unlikely anytime soon.
And analysis provided to the government estimates the new agreement will boost UK exports by £1.7bn, imports to the UK by £1.6bn and GDP by £1.8bn in the long term.
Speaking to Sophy Ridge on Sunday, Trade Secretary Kemi Badenoch said these figures needed to be examined in the context of the benefits of being a member of a trading bloc.
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She said: “The contents of the free trade deals that we have with these countries is different from what we’re getting with CPTPP.
“That’s why it’s called the comprehensive – as well as progressive agreement – for the trans-Pacific partnership.
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“There is one additional country, which is Malaysia, that we have no agreements whatsoever with, but it isn’t just about whether or not we have an agreement.
Who is in the CPTPP?
Australia
Brunei
Canada
Chile
Japan
Malaysia
Mexico
New Zealand
Peru
Singapore
Vietnam
“We’ve got agreements with many different countries – it is about the size, shape and scale and the cumulative impact of things like rules of origin, which are pooled between this trading bloc.”
Asked about the likelihood of an agreement with the US, Ms Badenoch said: “The US is not carrying out any free trade agreements with any country, so I would say very low. It all depends on the administration.”
She added: “But for now they said that that’s not something that they want to do, and we need to respect that.”
It is not the first time the government has lauded its own efforts with CPTPP, with Ms Badenoch and Mr Sunak praising the UK being accepted into the bloc in March.
The UK was already set to benefit from its agreements with the CPTPP regardless of the next phase of membership, with exports estimated to rise by 65% by the start of the next decade – valued at £37bn.
Ms Badenoch pointed out that the Indo-Pacific is forecasted to be where half of global growth will come from by around the middle of the 2030s, and will continue growing into the middle of the century.
Outside the UK government, there was more of a muted welcome for the UK’s joining the bloc.
Chris Devonshire-Ellis, the chairman of Dezan Shira & Associates which works with investors across Asia, spoke to the Nikkei overnight.
He said: “The impact appears mainly cosmetic, for the UK to show it made a trade deal after Brexit.”
Labour’s shadow trade secretary, Nick Thomas-Symonds, said progress in the Indo-Pacific was “long overdue”.
He added: “The government’s own assessment says CPTPP is worth just 0.08% to UK GDP.
“So ministers also need to set out how this will help the economy and what support will be given to businesses to access any export opportunities.
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March: ‘Palm oil is a great product’
“The government’s trade record is: OBR predict UK exports to fall by 6.6% in 2023, a hit of over £51bn; No promised US or India trade deals; Their own MPs criticising the Australia deal.
“This costs the UK growth and jobs – making the Tory economic crisis even worse.”
Trevor Phillips will host Sky News’ agenda-setting flagship political talk show when it returns in September
And they’re off! Bridget Phillipson was first away in her two-horse race with Lucy Powell in the Labour deputy leadership stakes.
Facing a rival who was sacked from the government nine days earlier, the education secretary said the deputy leader should be a cabinet minister, as Angela Rayner was.
Launching her campaign at The Fire Station, a trendy music and entertainment venue in Sunderland, she also vowed to turn up the heat on Nigel Farage and Reform UK.
She also repeatedly called for party unity, at a time when Labour MPs are growing increasingly mutinous over Sir Keir Starmer’s dealings with sacked Washington ambassador Lord Mandelson.
Despite Ms Phillipson winning 175 nominations from Labour MPs to Ms Powell’s 117, bookmakers StarSports this weekend made Ms Powell 4/6 favourite with Ms Phillipson at 5/4.
But though the new deputy leader will not be deputy prime minister, a title that’s gone to David Lammy, Ms Phillipson praised the way Ms Rayner combined the two roles and rejected suggestions that as a cabinet minister she would be a part-time deputy leader.
“What can be achieved under a deputy leader with a seat at cabinet, just look at Angela Rayner,” Ms Phillipson told her enthusiastic supporters.
“Angela knew the importance of the role she had. There was nothing part-time about her deputy leadership.
“Last year I campaigned up and down the country to get Labour candidates elected – I’ve not stopped as education secretary – and I won’t stop as deputy leader.
“Because with local elections, and with elections in Wales and Scotland right around the corner, that role is going to be more important than ever.
“So that’s why, today, I pledge to continue Angela Rayner’s campaigning role as deputy leader.
“Continuing her mission to give members a strong voice at the cabinet table.
“Her ruthless focus on getting our candidates elected and re-elected, alongside her total determination to drive change from government. Because what mattered was not just what she believed, but that she could act on it.”
Ms Phillipson pledged to run a campaign of “hope, not grievance” and claimed the party descending into division would put the chances of children and families benefiting from Labour policies at risk.
But admitting Sir Keir Starmer’s government had made mistakes, she appealed to party members: “You can use this contest to look backward, to pass judgement on what has happened in the last year, or you can use it to shape positively what happens in the run-up to the next election.
“Back me so I can unite our party, deliver the change we want to see and beat Reform. Back me so together, we can deliver that second term of Labour government.”
Image: Phillipson with Labour supporters at her campaign launch on Sunday. Pic: PA
Starmer’s candidate vs Manchester mayor’s
As she did in a speech at the TUC conference last week, Ms Phillipson spoke about her upbringing “from a tough street of council houses in the North East all the way to the cabinet”.
At the TUC, she said she grew up – “just me and my mam” – and told how when she was nine, a man who’d burgled the house turned up at the front door with a baseball bat and threatened her mother.
Ms Powell, who enjoys the powerful backing of Labour’s ‘King of the North’ Andy Burnham, called this weekend for a change in culture in 10 Downing Street, with better decisions and fewer unforced errors.
His backing has led to the deputy contest being seen as a battle between Sir Keir’s candidate, Ms Phillipson, and that of the Greater Manchester mayor, seen increasingly as a leadership rival to the prime minister.
And like all the best horse races, with the betting currently so tight, when the result is declared on 25 October the result could be a photo-finish.
Appointing Lord Mandelson as the UK’s ambassador to the US was “worth the risk”, a minister has told Sky News.
Peter Kyle said the government put the Labour peer forward for the Washington role, despite knowing he had a “strong relationship” with convicted sex offender Jeffrey Epstein.
It is this relationship that led to Peter Mandelson being fired on Thursday by the prime minister.
Image: Lord Mandelson and Jeffrey Epstein. File pic
But explaining the decision to appoint Lord Mandelson, Business Secretary Mr Kyle said: “The risk of appointing [him] knowing what was already public was worth the risk.
“Now, of course, we’ve seen the emails which were not published at the time, were not public and not even known about. And that has changed this situation.”
Speaking to Sunday Morning with Trevor Phillips, he rejected the suggestion that Lord Mandelson was appointed to Washington before security checks were completed.
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He explained there was a two-stage vetting process for Lord Mandelson before he took on the ambassador role.
The first was done by the Cabinet Office, while the second was a “political process where there were political conversations done in Number 10 about all the other aspects of an appointment”, he said.
This is an apparent reference to Sir Keir Starmer asking follow-up questions based on the information provided by the vetting.
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‘We knew it was a strong relationship’
These are believed to have included why Lord Mandelson continued contact with Epstein after he was convicted and why he was reported to have stayed in one of the paedophile financier’s homes while he was in prison.
Mr Kyle said: “Both of these things turned up information that was already public, and a decision was made based on Peter’s singular talents in this area, that the risk of appointing knowing what was already public was worth the risk.”
Mr Kyle also pointed to some of the government’s achievements under Lord Mandelson, such as the UK becoming the first country to sign a trade deal with the US, and President Donald Trump’s state visit next week.
Mr Kyle also admitted that the government knew that Lord Mandelson and Epstein had “a strong relationship”.
“We knew that there were risks involved,” he concluded.
PM had only ‘extracts of emails’ ahead of defence of Mandelson at PMQs – as Tories accuse him of ‘lying’
Speaking to Sky News, Kyle also sought to clarify the timeline of what Sir Keir Starmer knew about Lord Mandelson’s relationship with Epstein, and when he found this out.
Allegations about Lord Mandelson began to emerge in the newspapers on Tuesday, while more serious allegations – that the Labour peer had suggested Epstein’s first conviction for sexual offences was wrongful and should be challenged – were sent to the Foreign Office on the same day by Bloomberg, which was seeking a response from the government.
But the following day, Sir Keir went into the House of Commons and publicly backed Britain’s man in Washington, giving him his full confidence. Only the next morning – on Thursday – did the PM then sack Lord Mandelson, a decision Downing Street has insisted was made based on “new information”.
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Vetting ‘is very thorough’
Speaking to Sunday Morning with Trevor Phillips, Mr Kyle said: “Number 10 had what was publicly available on Tuesday, which was extracts of emails which were not in context, and they weren’t the full email.
“Immediately upon having being alerted to extracts of emails, the Foreign Office contacted Peter Mandelson and asked for his account of the emails and asked for them to be put into context and for his response. That response did not come before PMQs [on Wednesday].
“Then after PMQs, the full emails were released by Bloomberg in the evening.
“By the first thing the next morning when the prime minister had time to read the emails in full, having had them in full and reading them almost immediately of having them – Peter was withdrawn as ambassador.”
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4:48
Government deeming Mandelson to be ‘worth the risk’ is unlikely to calm Labour MPs
The Conservatives have claimed Sir Keir is lying about what he knew, with Laura Trott telling Sky News there are “grave questions about the prime minister’s judgement”.
The shadow education secretary called for “transparency”, and told Sunday Morning with Trevor Phillips: “We need to understand what was known and when.”
Image: Laura Trott says there are ‘grave questions about the prime minister’s judgement’
They believe that Sir Keir was in possession of the full emails on Tuesday, because the Foreign Office passed these to Number 10. This is despite the PM backing Mandelson the following day.
Ms Trott explained: “We are calling for transparency because, if what we have outlined is correct, then the prime minister did lie and that is an extremely, extremely serious thing to have happened.”
She added: “This was a prime minister who stood on the steps of Downing Street and said that he was going to restore political integrity and look where we are now. We’ve had two senior resignations in the space of the number of weeks.
“The prime minister’s authority is completely shot.”
But Ms Trott refused to be drawn on whether she thinks Sir Keir should resign, only stating that he is “a rudderless, a weak prime minister whose authority is shot at a time we can least afford it as a country”.