Saturday, 30 January 2021

Actually, CPTPP isn't a bad idea


The UK is applying to join a free trade area made up of 11 Asia and Pacific nations, under its post-Brexit plans. The Comprehensive and Progressive Agreement for Trans-Pacific Partnership - or CPTPP - includes Australia, Canada, Japan and New Zealand.

Hitherto now I've been somewhat sceptical in that one wonders what value there is in joining a regional trade agreement on the other side of the planet comprising of members we already have comprehensive agreements with. Furthermore, it is not a regulatory union, and not all that deep in terms of regulatory cooperation. It largely builds on copy-outs from WTO agreements and GATT.

Comprising of only 10% of our current exports, it's difficult to see what noticeable value it will have. It goes no way toward softening the impact of leaving the single market, America is unlikely to join it, and the rudimentary mutual recognition of conformity assessment within it doesn't really do much for us. More than likely it will complicate our remaining exports to the EU. The further we move away from a Europe first policy, the bigger the problems we have. But then since we seem to be hell bent on ruining most of our exports with the EU anyway, that's something of a moot point.

From a trade point of view you could easily conclude that CPTPP isn't worth the bother. But in taking such a narrow view I'm falling into the trap of seeing relations only in terms of their more immediate material gains. More than likely the government is taking a more strategic view to strengthen trade and investment ties with the Asia Pacific region. The agreement itself doesn't appear to go very far on investment but it does have that potential, and though it is not a regulatory union, it does commit the members to working on regulatory coherence and standardisation.

This pans out quite well for the UK in that it doesn't really require much of us. The UK is already at the global benchmark in most areas, while other CPTPP members have committed to reaching that bar by way of their deals with the EU. The UK, therefore, is well placed to consult on these matters. By driving forward the convergence agenda, the UK recruits more non-EU partners to its own initiatives, thereby counterbalancing EU clout in various international organisations.

Ultimately the UK needs a presence in the region and it also needs to upscale its regulatory diplomacy operation, and CPTPP is as good a place to start as any. Though the EU and UK may have set the standards for trade in goods, areas such as digital trade and electronic commerce are still relatively virgin territory out in the big world. There are threats and opportunities on the horizon, and CPTPP, if nothing else, is a good early warning system. One might even argue that if the UK is going to rebuild its trade and diplomatic capabilities we can't afford not to join, and sitting alongside Australia, Canada, Japan and New Zealand, we are at least among friends and allies. 

Where there is genuine concern about CPTPP is the lack of transparency over the decision-making and the complete absence of public debate - and the debate that does exist in Westminster is a low information debate among politicians and journalists whose understanding of the issues has not meaningfully advanced since 2016. Meanwhile the government seems intent on avoiding all scrutiny.

We will no doubt see a great deal of scaremongering over CPTPP, be it food standards or carve outs for the NHS, or ISDS, most of which will be irrelevant noise and party political gaming. It that respect, it wouldn't matter if there was a system for parliamentary scrutiny since MPs are usually distracted by the trivia, recycling the same old themes while utterly neglecting things like services and digital trade - and even if they were asking the right questions, they tend not to understand the answers. There likely are problems with CPTPP but we likely shan't know what they are until it's too late. But then that was true of the EEC, so we are at least consistent, I suppose. 

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