London (Parliament Politics Magazine) – The UK business and trade secretary, Jonathan Reynolds, has signalled a fresh twin-track strategy to UK trade policy, in which the Labour government will seek closer ties with the European Union while at the same time pursuing new global partnerships further afield.
How Will the UK’s Entry into the CPTPP Impact Its Trade Policy?
Reynolds accommodates the UK’s imminent entry into the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) as a “real win” for UK exporters. His comments demonstrate that Keir Starmer’s government will not desire to rejoin the EU or its economic structures.
The CPTPP is a free trade deal between Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam. Under the Tory government, Britain inscribed an agreement to enter the CPTPP in July 2023, and the accession procedure is nearing completion. The bloc will have a blended GDP of more than £12tn including Britain.
What Are the Expected Economic Benefits of the UK’s New Trade Deals?
The spending watchdog stated that two separate bilateral agreements between Britain Australia and New Zealand, also hailed as landmark trade arrangements following Brexit, “might increase the level of real GDP by a combined 0.1% by 2035”. Reynolds explains that Labour would also be pushing for closer relations with the EU, outside its formal economic and trading arrangements. “The EU is not just our closest trading partner, it’s still our largest trading partner by quite some margin,” he notes.
How Does Labour’s Trade Policy Differ from the Previous Government’s Approach?
“Yet, we comprehend that thousands of British businesses have ceased exporting to Europe altogether. It’s no secret as to why. The last government’s adversarial practice to working with the EU resulted in UK companies being buried in bureaucracy. We’re changing practice– working towards arranging the removal of unnecessary border checks while securing reciprocal recognition for professional qualifications so UK businesses can more easily operate in France, Germany, Italy and beyond.
“At the same time, we’re seeking high-quality, barrier-removing trade deals with allies around the world, including the Gulf Cooperation Council (GCC) and India. A contract with the GCC alone could boost bilateral trade by 16%, generating an additional £1.6bn for our economy in the long run.”