Rishi Sunak’s deal on Northern Ireland’s post-Brexit trading regime could have an unexpected spin off: helping Britain to imminently seal a long-awaited transpacific trade deal.
British government officials admit the row over EU-UK customs arrangements for Northern Ireland has been raised as an issue in trade talks with 11 countries in the Pacific region.
Trade experts confirmed that members of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership — a group that includes Canada, Japan and Mexico — were worried about the issue.
They said Britain’s threat to unilaterally rewrite its Brexit treaty with the EU over Northern Ireland trade arrangements had raised concerns in the Pacific about the UK’s place in a rules-based trade organisation.
In particular, there were fears that Britain’s threat to rip up an international treaty — now dropped by Sunak — could have set a precedent for future CPTPP applicant countries, notably China.
“They have been raising it,” said Sam Lowe, a trade expert and partner at Flint Global. “The CPTPP is a rules-based group and very respectful of order. It’s important that members are upstanding citizens.”
Lowe said there was a suspicion that the US, which was pushing Sunak to strike a Brexit deal with the EU, may have put pressure on CPTPP members to raise their concerns.
David Henig, trade expert at the European Centre For International Political Economy, said: “Certain members were watching the Northern Ireland situation carefully because they feared China.”
He said there was a risk that Britain could be seen as a “lawbreaker” if it passed legislation — the proposed Northern Ireland protocol bill — to unilaterally rewrite the UK-EU Brexit treaty.
“The CPTPP is a high-standards, rules-based body,” he said. “Plus China has applied to join.” As part of the UK-EU deal struck on Monday, Sunak announced he was ditching the Northern Ireland protocol bill.
Discussions on Britain’s accession to the CPTPP are under way in Vietnam this week, attended by trade minister Nigel Huddleston, with hopes rising that an agreement could be tied up soon.
UK government insiders confirmed that confusion about the exact customs status of Northern Ireland had been raised in the talks and that the so-called Windsor framework agreed by Sunak and the EU this week provided “certainty”.
However, they downplayed suggestions that CPTPP countries were concerned about Britain’s reliability as an international partner, insisting this had not featured in recent discussions in Vietnam.
The Department for Business and Trade said: “Joining CPTPP will mean UK businesses are eligible for tariff-free access on over 99 per cent of goods exported to a market of over 500mn customers and create new opportunities for modern industries like tech and services, supporting high-value jobs across the UK.
“We intend to join on terms that work for the UK’s interests and domestic priorities and look forward to concluding negotiations at the earliest opportunity.”
The CPTPP is a free trade area comprising 11 countries: Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, Peru, New Zealand, Singapore and Vietnam.
Britain would be the first country to join from outside the region. Concluding a deal with the bloc would allow Sunak to claim that he is exploiting post-Brexit freedoms to strike ambitious new trade deals.