Ignore the doomsayers Rishi's deal is a triumph, says JOHN LONGWORTH.
The CPTPP deal is really about geostrategic positioning: that is why the eminent voices from around the world - including Brussels' former top trade official - are impressed.
15:53, Sat, Apr 8, 2023.
Entrepreneurs are risk-takers by nature, and optimists by necessity. Talking yourself down makes no sense, and has no value. In my journey from the world of business to politics, I have found that Westminster operates on the opposite principle. Naysayers are everywhere: in Parliament, in the commentariat, in the endless white noise created by New Labour-era Quango-land. Talking the country down has become an SW1 not to mention a W1A obsession, especially in recent years.
Rishi Sunak and certainly his estimable Trade Secretary, Kemi Badenoch may have just worked out how to cut through all of that, to tap into a sense of optimism and strategic vision that the country desperately needs to hear.
When the UK’s accession to the CPTPP trade deal was announced, plaudits flowed in. Cecilia Malmstrom, the EU’s former Trade Commissioner, tweeted her congratulations to London and lamented the EU’s lack of progress. Wendy Cutler, the former US Deputy Trade Representative, said the U.K’s accession was so significant, the U.S. should “reconsider its entire regional trade strategy”.
Malaysia’s Deputy Prime Minister, Fadillah Yusof, hailed it as “a fantastic opportunity” for the U.K in Asian markets.
And yet, here at home, the infamous ‘doomsters and gloomsters’ were determined to present this global success story as a defeat.
Two particular narratives on CPTPP have emerged from the Westminster Eeyores – the first is that the GDP benefits are small using myopic data; the second is that cutting tariffs on imports will reduce standards in the UK. Speaking of Malaysia a good example of this misrepresentation is palm oil, supposedly an environmental scandal.
The GDP benefits estimated by Whitehall amount to 0.08% of GDP, a figure seized upon by the anti-trade (and anti-Brexit) blob as evidence of failure. A brief tour through recent economic projections shows the seriousness with which these data should be treated (Did I miss the predicted 4% immediate drop in GDP after the referendum? The 600,000 extra unemployed? Did I only imagine the accelerated post-COVID recovery that no modelling predicted?).
Even if the 0.08% number was legitimate, the isolationists miss the real story. The objective is to increase trade and thus GDP by both selling goods and buying cheaper components and products, both of which boost the economy. It is also further magnified by the very rapid growth of the trans-Pacific economies. The civil servants of New Zealand underestimated their trade benefits by a factor of five times.
The CPTPP deal is really about geostrategic positioning: that is why the eminent voices from around the world – including Brussels’ former top trade official – are impressed. The centres of gravity on global security, supply chains, and diplomacy are all shifting eastwards to the Indo-Pacific. The U.K. now has a seat at the biggest table in the region; no-one else from Europe is even in the room. Express.
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