CPTPP: UK has joined Asia's trade club but what is it?

Published On Jan 30, 2021, 5:31 PM

The UK has joined the CPTPP (Comprehensive and Progressive Agreement for Trans-Pacific Partnership), a trade pact involving 11 nations, marking its first major trade agreement post-Brexit. While the immediate gains for the UK economy are expected to be minimal (approximately 0.08% of GDP over the next decade), the partnership enhances market access and could benefit UK producers in sectors like machinery and medicines. The agreement also promotes investment flows and regulatory cooperation among member countries. However, concerns exist regarding environmental standards and the potential impact on domestic policies due to increased foreign investment.

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Stock Forecasts

GSKView GSK chart on TradingView

Positive

With the UK's entry into the CPTPP, there could be modest positive sentiment towards sectors that could benefit from reduced trade barriers, particularly in manufacturing and pharmaceuticals. This could translate into positive movements for UK-based companies in these sectors.

EWUView EWU chart on TradingView

Neutral

The broader macroeconomic impact of the CPTPP membership is expected to be limited in the short term, which may keep UK market sentiments neutral towards the overall economic outlook. Investors may be cautious until more concrete benefits of the trade agreement materialize.

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