Yahoo Finance Brexit: UK looks to secure trans-Pacific trade deal
Britain has held exploratory talks to join a trans-Pacific trade group once the UK leaves the European Union.
The plan would see the UK become the first member to sign up to the Trans-Pacific Partnership (TPP) that does not border the Pacific Ocean or the South China Sea.
Liam Fox’s department for international trade is reported to be keen to commit to the group, despite it suffering a blow last year when the United States, its largest member, withdrew on the orders of President Donald Trump.
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Trade minister Greg Hands told the Financial Times there was no geographical restriction on which trading groups Britain could join in a post-EU era.
“Nothing is excluded in all of this,” he said. “With these kind of plurilateral relationships, there doesn’t have to be any geographical restriction.”
The UK formally leaves the EU trading bloc in March 2019 – although a two-year transition arrangement has been proposed to smooth the process.
It’s not clear exactly what that period would mean for the UK in terms of trade and business rules and regulations – as well as laws.
Additionally, while Theresa May and her Brexit team can hold talks with potential trading partners before leaving, nothing concrete can be signed – and that may continue to apply during the transition period.
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Regardless, Britain’s trade with the 11 nations which make up the TPP, including Canada, Japan, Australia and Mexico, pales when compared with the EU.
Combined spending from the TPP countries make up less than 8% of the UK’s export market. Japan takes just 1.6% of UK exports, compared with the 11% bought by Germany.
The same applies to UK exports of financial and other services. In the first half of last year, the UK exported almost £1.7bn in services to Japan – but the UK exported £16.6bn in services to the US during the same period.
Following the departure of the US, the TPP bloc is working on a revised trade deal, the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, which is expected to be agreed early this year.
A spokeswoman for the Department of International Trade said the government had not ruled out “plurilateral relationships”.
She added: “We have set up 14 trade ‘working groups’ across 21 countries to explore the best ways of progressing our trade and investment relationships across the world.”
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UK officials have discussed the possibility of joining the TPP with counterparts in Australia and New Zealand, where foreign secretary Boris Johnson visited last year to press the case for British business and trade.
Liam Fox is set to travel China this week on a three-day mission to forge closer links.
