United Kingdom joins key trade pact amid growing Indo-Pacific importance

The United Kingdom has recently joined the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), marking a significant step in its trade policy aimed at expanding its economic presence in the Indo-Pacific region. This accession follows a milestone meeting of the CPTPP Commission held in Vancouver, where the U.K. government participated for the first time and engaged in trade negotiations with members from the Indo-Pacific region. The CPTPP, established in 2018, includes nations like Australia, Canada, Japan, and Vietnam among its members, and is seen as a bulwark for free trade, emphasizing shared principles such as open markets and labor standards. With the U.K. joining, the combined GDP of the CPTPP members is expected to rise to approximately $21 trillion, highlighting the strategic economic importance of the Indo-Pacific. The U.K. government estimates that its participation in the CPTPP could boost its GDP by around £2 billion annually by 2040. Last week, the U.K. also began formal trading under the agreement, with trade in goods and services already reaching £121.4 billion for 2023 with the existing members. The context for the U.K.'s accession lies in a larger global trend where the Indo-Pacific region is projected to account for the majority of global economic growth and a significant portion of the world's middle-class consumers in the coming decades. Notably, by 2050, China and India are expected to emerge as the largest and third-largest economies. This anticipated growth underscores the necessity of transpacific partnerships for economic security and future prosperity. The U.K.’s entry into CPTPP reflects a consensus among successive British governments about the Indo-Pacific's vital role in the global economy, drawing parallels with Canada's position as a Pacific power. Thus, the U.K. becoming the first European nation to join the CPTPP exemplifies a strategic pivot towards strengthening trade ties in a region that is critical to shaping global trade rules and responding to evolving economic dynamics. The membership not only reinforces the U.K.'s commitment to free trade but also establishes a collaborative framework with key partners in the Indo-Pacific, enabling the development of strategic alliances that will support economic stability and growth.