Thread by @AnnaJerzewska

So the UK started the CPTPP negotiations today. And the benefits of joining according to Gov's own estimates are... moderate at best... 0.08%.

And that is if they have taken into account all the bilateral deals that the UK already has with CPTPP members

/1

https://twitter.com/Joe_Mayes/status/1407246326480486404

These deals will take away from the impact of the CPTPP.

Joe also mentioned the caveat in the report.
Measuring the impact of FTAs before they are implemented or negotiated is tricky and can only provide a rough estimate.

/2

https://twitter.com/Joe_Mayes/status/1407246346910932992

CGE modelling is static and doesn't take all the expected benefits of an FTA into account.

Given all the bilateral deals joining the CPTPP is mostly around strategic and geopolitical objectives.

Plus regional cumulation, some stuff on digital and other bits and pieces.

/3

And a lot of these strategic objectives - like convincing our trading partners that Brexit wasn't just about protectionism and that we do want to play with others - are hard to capture with these traditional modelling techniques.

/4

But, that works both ways. What CGE modelling doesn't fully take into account are utilisation rates - the fact that companies may simply not use that deal.

And there is a range of factors here - from existing supply chains to available guidance.

/5

So yes, it's hard to estimate the impact on GDP but it's fair to say it will be very small.
For those of you wondering - it will not in any way replace trade with the EU or balance out the effects of leaving it.

/6

Personally, I don't know of a single company interested in CPTPP. I know there are some, of course, but it doesn't really come up.

The US and Australia - yes. CPTPP- never.

/7

The geopolitical objectives are not to be ignored and a small positive impact on GDP is still a positive impact on GDP but something tells me we're about to hear a lot of inflated numbers and exaggerated claims about this deal.

8/8