Trade for prosperity

By Natalie Black CBE, HM Trade Commissioner to Asia Pacific

Asia Pacific is the engine room of the global economy and the focal point for the UK’s trade ambitions. In March 2021, the UK Government published its Integrated Review, identifying the broader Indo-Pacific as a top economic, security and diplomatic priority for the 2020s. The Review confirmed the UK’s commitment to strengthening an enduring effort in the Indo-Pacific, a region that is the focus for many of the most pressing global challenges – from climate and biodiversity to maritime security and geopolitical competition linked to rules and norms.

With six G20 members and a pivotal role in international supply chains, the Indo-Pacific is increasingly where global trade dynamics are shaped. The evidence is clear: the centre of economic gravity is moving east.

The Indo-Pacific is expected to account for half of global GDP growth over the next thirty years.1  65% of the world’s middle-class consumers are expected to be in Asia – driving global demand for precisely the type of high-quality goods and services in which the UK excels. 

This presents a fantastic opportunity for UK companies, which the Government is supporting with an ever-increasing number of free-trade agreements (FTAs). To date, the UK has trade deals with six Asia Pacific markets: Australia, Japan, New Zealand, Singapore, South Korea and Vietnam. By implementing these agreements effectively we aim to create a favourable trading environment and bring benefits to UK businesses.

The most recent FTAs, signed with Australia and New Zealand, break new ground for the UK in supporting shared climate and environment goals, clean growth, and the transition to a net-zero economy. This is another example of how we have mainstreamed a low-carbon focus into and beyond COP26; the Build Back Better World initiative and UK Export Finance can catapult these ambitions further. 

Asia Pacific also represents a significant opportunity on tech. The digital economy of the ASEAN group of nations is projected to hit a colossal $1 trillion by 2030. In 2020, the UK launched a Digital Trade Network in Asia Pacific, cementing our connections as a tech superpower with reach into the most dynamic and innovative companies in the region. 

The UK-Singapore Digital Economy Agreement, signed in February, is the most innovative digital-trade agreement ever agreed and the first such agreement signed by a European nation. It will strengthen our trading relationship with Singapore – worth £16 billion in 2020 – by ending outdated rules that affect both goods and services exporters, making it easier for UK businesses to target new opportunities in both Singapore and the wider region.

And our UK-Japan Comprehensive Economic Partnership Agreement contains some of the most advanced digital-trade provisions seen in any modern trade agreement. 

Finally, yet importantly, talks between the UK and member countries of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) are progressing well. The UK is on the path to joining the £8.4 trillion free-trade area – we have an ambitious timeline for accession to CPTPP and hope we will be able to have concluded negotiations by the end of 2022.

This is a key priority for the Department for International Trade’s (DIT) Asia Pacific team this year, alongside deepening our network of trade dialogues.

At the centre of the Integrated Review is a commitment to delivering through multilateral and regional partnerships. In doing so, we will ensure the UK supports and shapes global trade rules, and that our trade diplomacy in Asia Pacific supports wider Government objectives in areas like sanctions and supply-chain resilience. We will support Indonesia’s G20 Presidency and agree a wide-ranging ‘Plan of Action’ with ASEAN to deliver our economic and trade priorities.    

In 2022, the DIT team in Asia Pacific are looking forward to deepening our partnership with the ICC. We are already collaborating on a number of new initiatives on supply chains and digital trade but there is much more we can do together. As major events return across the region, we also hope to welcome many of ICC’s members to this part of the world. Plus, we will be present at key events in the UK including London Tech Week. Please connect with me on LinkedIn if you would like to collaborate.

References
1 DIT Global Trade Outlook 2021

New trade deals are unlocking opportunities in green and digital commerce

By the Department for International Trade

Digital commerce underpins much of 21st century trade and contributes trillions of pounds in value to the global economy. Similarly, the worldwide market for low-carbon goods and services is huge. Both areas are growing rapidly, presenting significant opportunities for British companies. With its strengths in the services sectors and clean growth, the UK is well placed to take advantage of these opportunities. 

The UK Government, led by the Department for International Trade (DIT), is supporting this via an ambitious programme of free-trade agreements (FTAs). DIT is negotiating FTAs and building relationships with trading partners to break down barriers to trade and support growth, jobs and higher wages for UK workers. To date, the department has agreed trade deals with 70 countries plus the EU1, partners that accounted for £772 billion of UK bilateral trade in 20202. 

Here we highlight some of the key opportunities in digital and green trade in four of these markets: Australia, Japan, New Zealand and Singapore. 

References
1  The UK-EU figure, which forms part of the UK bilateral trade figure, includes trade with the EU27 plus Andorra, San Marino, EU overseas territories and UK crown dependencies
2 Source: ONS UK trade, all countries, seasonally adjusted, Q3 2021. UK trade with secured partners was worth £917bn bn in 2019. Statistics on UK trade during 2020 suggest evidence of COVID-19-related impacts though these cannot be separately identified.

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