Joining Indo-Pacific trade bloc could only boost UK GDP by £1.8bn – and no deal with US anytime soon
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.
Politics latest: Chances of free trade deal with US ‘very low’
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.
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.
“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.
“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.”
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A Tory bid to launch a new national inquiry into the grooming gangs scandal has been voted down by MPs amid criticism of “political game playing”.
MPs rejected the amendment to the Children’s Wellbeing Bill by 364 to 111, a majority of 253.
However, even if the Commons had supported the measure, it wouldn’t have actually forced the government to open the desired inquiry, due to parliamentary procedure.
Instead, it would have killed the government’s legislation, the aim of which is to reform things like the children’s care system and raise educational standards in schools.
Follow politics latest: Reaction to vote
Tonight’s vote was largely symbolic – aimed at putting pressure on Labour following days of headlines after comments by Elon Musk brought grooming gangs back into the spotlight.
The world’s richest man has hit out at Sir Keir Starmer and safeguarding minister Jess Phillips, after she rejected a new national inquiry into child sexual exploitation in Oldham, saying this should be done at a local level instead.
The Tories also previously said an Oldham inquiry should be done locally and in 2015 commissioned a seven-year national inquiry into child sex abuse, led by Professor Alexis Jay, which looked at grooming gangs.
However, they didn’t implement any of its recommendations while in office – and Sir Keir has vowed to do so instead of launching a fresh investigation into the subject.
Jess Phillips exclusive:
Victims can have inquiry if they want one
The division list showed no Labour MPs voted in favour of the Conservative amendment.
Those who backed the proposal include all of Reform’s five MPs and 101 Tory MPs – though some senior figures, including former prime minister Rishi Sunak and former home secretaries James Cleverly and Suella Braverman, were recorded as not voting.
The Liberal Democrats abstained.
Speaking to Sophy Ridge on the Politics Hub before the vote, education minister Stephen Morgan condemned “political game playing”.
“What we’re seeing from the Conservatives is a wrecking amendment which would basically allow this bill not to go any further,” he said.
“That’s political game playing and not what I think victims want. Victims want to see meaningful change.”
As well as the Jay review, a number of local inquiries were also carried out, including in Telford and Rotherham.
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Grooming gangs: What happened?
Speaking earlier in the day at PMQs, Sir Keir Starmer accused Conservative leader Kemi Badenoch of “jumping on the bandwagon” after Mr Musk’s intervention and spreading “lies and misinformation”.
Referring to her time in government as children’s and equalities minister, the prime minister said: “I can’t recall her once raising this issue in the House, once calling for a national inquiry.”
He also said having spoken to victims of grooming gangs this morning, “they were clear they want action now, not the delay of a further inquiry”.
Ms Badenoch has argued that the public will start to “worry about a cover-up” if the prime minister resists calls for a national inquiry, and said no one has yet “joined up the dots” on grooming.
Girls as young as 11 were groomed and raped across a number of towns in England – including Oldham, Rochdale, Rotherham and Telford – over a decade ago in a national scandal that was exposed in 2013.
There is a critical need for a comprehensive, responsible AI approach to address privacy, security, bias and accountability challenges in the emerging agentic economy.
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