Opening up Trans-Pacific trade

The UK’s access route to international markets took a step forward on 31st March 2023 with the announcement of the ‘substantial conclusion’ of negotiations in respect of the UK’s accession to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). Once all of the formalities have concluded the UK will gain extended access to a trade zone which represents a combined GDP of $11.8 trillion.

Commenting on the announcement, Emma Rowland, Policy Advisor for Trade at the Institute of Directors, said: “Accession to CPTPP is a win for the UK. This deal will offer UK firms new opportunities to compete in markets with growing consumer demand, high standards on free and fair trade, and strong commitments to services trade.”

Whilst there are already some trade agreements in place with countries in the CPTPP, accessing to the agreement will smooth out trade pathways for the UK with Australia, Brunei Darussalam, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam. This will include the abolition or lowering of trade tariffs and a reduction in ‘red tape.’

Whilst any reduction in barriers to trade is welcome, an entry into new marketplaces potentially requires an initial outlay in time and resources as businesses research marketplaces and customer preferences. Understanding tariffs and trading agreements is one thing; ensuring that products and approaches resonate with potential customers is quite another. With this in mind, what are the golden rules of opening up new markets:

Take time. The lure of new marketplaces can be strong but taking time to fully understand the market and the people can pay dividends in the long run. One wrong assumption at the outset and you could alienate a customer base which may never return.

Take advice. Relying on internal resources might seem like a cost saving but here again inexperience could lead to error. From trade departments to specialist organisations there is plenty of advice available which could help you to better design and target your products.

Understand the culture. The internet has helped to develop the feeling of a global village but countries and regions still have their own individuality. Understanding those cultural differences could again help you to avoid making a costly error in the way in which you bring your products to market. One misplaced advert or even the use of the wrong colour or tone in a product or brochure could be fatal to the development of a lasting partnership. Get it right and you have the chance to bring your product or service to more than five hundred million people living within the CPTPP.