The UK has completed its application to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), with existing members of the group unanimously agreeing to the ascension of the country at the end of last month.
It means the UK will become the 12th member of the bloc when formal agreements are signed later this year and has been hailed by the UK government as the biggest free trade deal signed since Brexit.
Prime Minister Rishi Sunak said the deal would offer the UK "unparalleled access to markets from Europe to the south Pacific" and position the country at the heart of a "dynamic and growing" group of countries.
He added: "As part of CPTPP, the UK is now in a prime position in the global economy to seize opportunities for new jobs, growth and innovation."
But what will the move mean in real terms for trade to and from the UK, and what could the wider implications for the future of the CPTPP agreement, especially when it comes to the possibility of further expansion in the years to come?
The immediate prospects for UK trade
According to the UK government, being part of CPTPP gives the country access to economies with a combined GDP of £11 trillion and, in the long run, could help boost the UK's exports to member countries by £1.7 billion. It noted that 99 percent of exports to the bloc will now be tariff-free, while it will also enable British businesses to diversify their supply chains and boost their resilience.
Rules of origin provisions in the deal allow for greater flexibility in manufacturing and production processes, enabling UK firms to procure materials from fellow CPTPP members and export finished goods to these nations freely.
The government also noted that red tape will be much reduced, allowing UK businesses to operate on a level playing field with local firms and bridging benefits such as greater certainty around licensing procedures.
However, some have suggested the direct economic benefit of being part of the bloc will be far more limited. The government's own estimates, for example, indicate the deal will only increase the UK's economy by 0.08 percent over the next ten years. By comparison, the country's Office for Budget Responsibility estimates that the impact of leaving the EU will reduce the nation's economic growth by four percent in the long term.
It has been noted that the UK already has preexisting free trade agreements with all CPTPP members except Brunei and Malaysia. Some of these were rolled over from its previous membership of the EU, while some, such as Australia, were negotiated post-Brexit.
Some experts have also suggested that any divergence from EU trade rules should also increase tensions between the UK and Brussels. Sam Lowe, a trade expert at the advisory firm Flint Global, told the Guardian: "CPTPP membership does make it more difficult for the UK to rejoin the EU customs union. But, given the UK will seemingly join without significant changes to EU-inherited regulations, it also demonstrates that EU and CPTPP regulatory approaches are compatible."
What it means for the future of CPTPP
The UK has emphasized, however, that the deal should not be viewed as a replacement for WEU trade and is a project for the long term. It noted that several other countries, including Costa Rica, Ecuador and Uruguay have also formally applied to join CPTPP, while Thailand, the Philippines and South Korea have all expressed interest in the bloc. If these nations were all to accede, an expanded CPTPP would cover ten percent of UK exports.
It has been suggested, however, that a key benefit of the deal will be strategic rather than economic, both for the UK's place in the global economy and for the precedent it sets for the CPTPP. One reason for the lengthy negotiations was that many CPTPP members are keen to set a high bar for future membership applications - particularly that of China, which is also bidding to join the group.
CPTPP members were keen to use the UK's negotiations to set the tone for any future membership applications and the fact that there were no major concessions from the bloc highlights clearly the members' position. Natalie Black, the UK's trade commissioner for Asia Pacific, told CNBC the barriers to entry were very high, adding: "It's really up to those who come behind us to make sure they meet the expectations of members of having high quality applications."
What's more, as any future enlargement of CPTPP requires the unanimous agreement of existing members, it could make it more difficult for China to join the agreement. The UK has been vocal about countering Beijing's increased influence in the region.
Indeed, former prime minister and foreign secretary Liz Truss is among the figures to urge the UK government to use its new power to veto China's entry, telling Politico: "I would expect the British government now or in the future to oppose any such proposal."
