UK counting down to CPTPP entry into force
CPTPP which will enter into force for the UK on 15 December 2024, will be the first free trade agreement between the UK and Malaysia.
Datuk Seri Utama Tengku Zafrul Aziz, Minister of Investment, Trade and Industry with Mr David Wallace, Acting British High Commissioner to Malaysia at the launch of a countdown to the UK’s CPTPP entry-into-force.
The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), which will enter into force for the United Kingdom (UK) on 15 December 2024, will be the first free trade agreement between the UK and Malaysia.
At an event in Kuala Lumpur, Mr David Wallace, Acting British High Commissioner to Malaysia, together with YB Datuk Seri Utama Tengku Zafrul Aziz, Minister of Investment, Trade and Industry jointly launched a countdown to the UK’s CPTPP entry-into-force moment.
CPTPP is a free trade agreement between 12 countries, spanning five continents. With the UK joining, the combined Gross Domestic Product (GDP) of the CPTPP members increases from over £9 trillion to around £12 trillion, from around 12% to 15% of global GDP.
With CPTPP, the UK and Malaysia will have a free trade agreement for the first time. This will offer significantly increased market access to both countries and will support shared ambition to remove barriers to trade. It will also create new opportunities for businesses and investors building on the work already completed by the Malaysia-UK Joint Committee on Bilateral Trade & Investment Cooperation.
At the launch event, YB Tengku Zafrul said:
We warmly welcome the UK into the CPTPP framework. As Malaysia’s first bilateral Free Trade Agreement with the UK, Malaysian exporters now have better access to the UK market, whose economy breached USD4 trillion in 2023. Malaysia’s CPTPP membership has certainly boosted our competitiveness, while fostering better integration of our exporters into the global supply chain.
In reiterating the benefits of CPTPP, Mr Wallace added:
The UK’s accession to the CPTPP marks a significant milestone in our trade relationship with Malaysia. By eliminating tariffs and streamlining trade processes, we are creating growth and a more prosperous future for both nations. It is time for businesses to prepare to take advantage of the of the agreement.
Bilateral trade between the UK and Malaysia currently totalled £5.7 billion in the four quarters to the end of Q2 2024. The CPTPP will enable local businesses to benefit from duty-free exports, boosting not only established sectors like electrical and electronics (E&E) and machinery and parts but also opening new prospects for Malaysia’s commodities such as palm oil; rubber; and timber in the UK market. CPTPP is also expected to boost the UK’s export of chocolate and cars to Malaysia.
In addition CPTPP will provide the opportunity to deepen British and Malaysian participation in each other’s supply chains and diversify our trade. The rules of origin provisions could provide greater choice for our businesses when sourcing intermediate goods as well as increase opportunities for exporters, including SMEs.
The UK’s accession to CPTPP will give Malaysian firms and professionals greater certainty when looking to work in the UK to deliver services on a temporary basis.
It also provides UK and Malaysian companies alike with a guaranteed right to compete for opportunities in each other’s government procurement market on equal terms with local suppliers.
Through CPTPP, Malaysia and the UK secure investment liberalisation commitments for the first time, providing greater certainty to investors wanting to establish businesses in the UK or Malaysia.