The Only Way is CPTPP? Measuring CPTPP trade success behind British/Indo-Pacific trade relations in line with the Indo-Pacific Tilt
01/04/2025 - Written by Amriza B. Batubara
Introduction
It’s been over three months since the UK joined a band of 14 other mainly Pacific Rim countries in a trade bloc that is the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (or CPTPP for short). An elaborated and renewed version of its predecessor the Trans-Pacific Partnership, which arguably fell through due to Trump’s policies that annulled much of its tariffs and severed ties trans-regionally in 2019, the UK became the first European country to have joined an Asia-Pacific grouping, beating the likes of France who has overseas territories like Wallis and Futuna and New Caledonia in the region. As the saying goes, it is claimed that the UK was only eligible for membership due to the rock that is the Pitcairn Islands - itself only a territory of 50-odd people. Yet, it has since granted them to a pool of other powerful, rapidly developing nascent powers shouldering Japan and Australia into closer ties. But just how big are these implications?
Initial interests were founded on product-specific tariffs, and driven by access optimisation. For Japan specifically, for instance, a UK membership would significantly benefit its sizable markets in Scotch whiskey, blue cheese, and digital trade. Nestled on the UK’s uncertain post-Brexit frontiers, it came complementary to the country’s “Brexiteering” endeavours. But as CPTPP began materialising its direct Pacific Rim membership, it began to materialise into a more serious outlook, stemming from the need to expand its membership to the broader world of trade instead of the Pacific Rim. After all, no body of water is exclusive to a nation anymore, and ships travel transboundarily. Under these lines of arguments, talks on UK accession became more serious.
Contextual Analysis
Since the turnaround of the 1998 Asian financial crisis and especially after the 2008 global recession, Asian economies have taken a juggernaut path. Beyond the aspirations of the Asian Tiger, China has spearheaded the path of developmental foreign policy, first with the Shanghai Cooperation Organisation (SCO) and later with the Belt and Road Initiative (BRI). On the contrary, the UK has seen a massive stymie to its economic growth since the Long Expansion (a time of continuous uninterrupted growth between 1992 and 2007) ended in the lead-up to the 2008 recession. For nearly two decades, the country has failed to hit even 2.0% in net growth and has gone through over five regime changes and counting. Hoping to expand its horizons to emerging markets, the UK leveraged its ex-EU position to make the pivot. Coming at a time of heightened tensions between the West and China, the UK faces a dilemma. To comply with their closest allies across the pond, or cooperate with the world’s next biggest player. While still a contentious point, much of the Global South, especially in Sub-Saharan Africa, Central Asia and Latin America, has begun to cooperate with Beijing and is receptive to their overtures, such as with the BRI infrastructural projects.
Social and Economic Dimensions of these Implications
In the absence of any military implications given the bloc’s arrangement as a trade bloc, it has otherwise reasonably large socio-economic implications.
Economic: A cursory glance at the first stipulations denotes CPTPP as a non-binding legal agreement that incorporates novel cross-border supply of or trade in the financial services, particularly curated for the banking, electronic payment card services (i.e.: payment card) and goods in international transit (pp. 8-10). It is unlikely that the CPTPP will elaborate further into a “deeper” initiative.
An alternative to the Windsor Framework, the CPTPP gives free rein for the UK to adopt more free trade policies in this contract law-like arrangement, while still under the restrain of complying to Article 20.5.1 (Protection of the Ozone Layer) and Regulation 517/2014 on Fluorinated Greenhouse Gases, as the few remnants of retained European Union law the British system adopted (New Zealand Government, 2018).
It is worth noting that the UK alone already has had prior free trade agreements with all 12 member states of CPTPP except for Brunei and Malaysia - a situation that changed in December 2024, with the signing of the UK’s first agreement with the latter (UK Government, 2024). Consequently, the ‘bundling’ of these agreements is expected to boost its economy by 0.08% in its first 12 months (BBC, 2023) - a statistic that has since been lambasted by opponents, calling the arrangement ‘futile’.
Juggling with the budding UK-EU Trade and Cooperation Agreement, the CPTPP is subject to change should the Windsor Framework make amendments - in which case, all member states will be notified. All in all, the CPTPP is very much comparable and indeed characteristic to Asia-Pacific international treaty law - resorting to unilateral relations-building with individual member states when it comes to “supporting” the mechanism, instead of utilising the organisation as a platform for the whole. Looking into its member states, a good portion of the CPTPP are states with sizable rare-earth reserves - a point that will be elaborated in both opportunity and risk.
Social: Lower tariffs and supply chain costs are likely to bring more variety in goods and diversity in British consumerist and spending habits, as previously hard-to-access goods (most prominently rare earth minerals) are expected to increase given the free-trade nature of CPTPP.
Whether it is enough to break even the negative impact imposed by Brexit or not is another discussion, but tapping into a “region which is rapidly growing in significance both economically and politically” (The Straits Times, 2024) is likely to receive warm reception to British markets.
More interestingly, the CPTPP is expected to benefit Indigenous Peoples of undisclosed trade, and by extension other under-represented groups in trade (GOV.UK, 2024). While unlikely to expand momentum on its political clout as much as it is marketed, CPTPP is likely to endorse and encourage more inclusive trade through means beyond gender equality, into cross-society support.
This is likely to manifest in lowering investment barriers to indigenous businesses instead of focusing on multinational corporations only - much to the expense of UK interests, given its lack of provisions for indigenous peoples in the socio-economic realm.
Key Players & Stakeholders
UK - Joining the EU five decades ago before subsequently leaving in 2019, the UK was struggling. Under the Sunak government, the UK announced its intentions to expand eastwardly in favour of an Indo-Pacific Tilt - strategic means to realign with the East more. The response was fractious. More hardline Tory leaders such as Robert Jenrick opposed the liberalisation to China, parroting American foreign policy and calling it a national security compromise.
China - A key player in the Indo-Pacific market despite not being a full-fledged member of CPTPP, China plays a mediating role in being a dynamic market leading an “alternative world order”. Despite being a key trading partner to the UK, the latter sees the former as a weary intermediary to the West, especially important in gauging for the UK’s foreign interests.
Japan - Unbeknownst to much outside policy circles, Japan is the UK’s closest ally in the region and have historically signed comprehensive agreements, pacts in defence and other exclusive sectors. A host of many Western interests including US military bases, Japan has since been a major player in disseminating development funds (only second to China in terms of quantity within Asia, at $20.8 billion per annum on average at 2023, or around 0.4% of Japan’s Gross National Income (GNI) (Devex, 2024), major regional power and member to the CPTPP since it was still the TPP in 2017.
Opportunities & Risks
Opportunities:
More investments in nascent, high-demand sectors such as rare earth minerals. As the tech front thrusts further into the stage, CPTPP will be vital in easing British access to rare-earth metals (and therefore semiconductors and green technology), especially as an alternative to Chinese dependence. Australia is the world’s largest lithium producer, and Canada is equally rich in nickel, cobalt and uranium - all essential for green technology and state-of-the-art defence (Natural Resources Canada, 2024). Together, the states make up approximately 27.06 million metric tonnes of rare-earth reserves (or about 22.55%), giving the UK much exposure in the market.
Boost in tourism: It is no stranger that Brits flock to Australia by the masses and vice versa. However, with a proliferation in sectoral investment and trade, trade liberalisations will likely happen under a receptive environment and be reflected in visa liberalisation policies as well - a policy implemented by CPTPP-adjacent economies affiliated with its sister organisation BRICS, such as Brazil. Suppose the UK does not want to falter its stocks in tourism and hospitality. In that case, the CPTPP is an unlikely holy grail to boosting its accessibility worldwide, beyond the reaches of Europe.
Closer ties to Indo-Pacific. Meanwhile, the region is one of the most up-and-coming corners of the world. By getting into CPTPP, Britain is getting its foot in the door and getting ahead of its European peers in shouldering potential economic giants. Vietnam particularly saw a 7.2% growth in its GDP last year, exceeding its yearly expectation of 5.0% only. To become part of the same pact as nations like Vietnam - and more to come, eventually - means the UK can gain reciprocal returns with its free trade agreements.
Risks:
Conflict of interest: China is expected to join the CPTPP soon, which, if successful, will pose a quagmire to traditional British foreign policy structures, especially with its historical Anglo-American alignments. With China itself a renowned rare-earth power (containing over 68.57% of the world’s rare earth reserves) (Statista, 2023), it is likely that its candidacy will be widely endorsed by member states, considerably more non-aligned than the Brits. In the instance of a Chinese entry, the Labour government will likely to be torn between complying with Trumpist notions of protectionism against China or embracing much-needed minerals that have long supported the nation’s semiconductors, chips and green technology.
Underestimated impact will harm the duressed economy. Forecasts have shown that GDP growth is only expected to bump up by 0.08%. That’s only around $2.7 billion per annum only. While initial promises were set high at 2-3% surpluses, the Brits are overestimating its power in trade, as there is likely to be a higher chance of tariffs being removed instead of robust, EU-like budgets injected on a regular. It must be cautious in hastily signing agreements with minimal shareholder value, as means to counter post-Brexit malaises.
Environmental repercussions. By ratifying the CPTPP, the UK has since cut duties and import tariffs on palm oil for its free trade with Malaysia - jeopardising its COP27 pledge of respective environmental safeguards, against deforestation in this case (Financial Times, 2024).
Policy Recommendations and Conclusion
To fulfil and maximise the CPTPP benefits, the UK must acknowledge more of its overlooked sectors, including reclassifying minority, native groups such as the Welsh and Scottish Gaelic communities to “indigenous” people and recognise them as such in the socio-economic realm, to ensure sustainable development does not centralise and pool in Westminster only. Furthermore, the UK must encourage other European states with significant Indo-Pacific presence (namely France and Germany) through its new UK-EU Competition Cooperation Agreement to join the CPTPP (WilmerHale, 2024). This will build on the latter agreement’s remit in regaining competitive markets and advantage within the broader European neighbourhood as well, independent of the EU. Lastly, to realise its full potential, the UK must ensure to expand its trade beyond the Asia-Pacific. While the CPTPP is likely to nip in the bud some of its most severe economic shortcomings, the UK must have better foresight in other soon-to-be nascent regions such as Sub-Saharan Africa, through the apparatus of developmental narratives.
To work with the CPTPP, the UK must move along and spread its eggs to different baskets - forgetting antiquated notions of animosity against especially the CCP in the realm of trade. While political interests are disparate, following Trump’s policy will only be of detriment to its dwindling market.