The call for input on future free trade agreements (FTAs) with Canada and Mexico will formally be launching as of today.
The UK has set its sights on the next generation of British-shaped trade deals to secure closer economic ties with major economies of today and tomorrow, with Canada currently being the ninth largest economy in the world, and Mexico forecast to become the seventh largest by 2050. These deals will secure more access for British goods and services, opening significant new opportunities for UK business by boosting trade with Canada and Mexico, already worth £22.8 billion and £5.1 billion respectively in 2019. They will cement the UK’s position as a world leader in digital and services trade, and constituent key building blocks to UK membership of CPTPP as well as delivering benefits to the whole of the UK.
The UK signed trade continuity agreements (TCAs) with both Canada and Mexico before the end of the transition period and committed to start negotiating the new trade deals later this year. Building on the deals signed in 2020, which secured tariff-free exports on 98% and 88% of goods to Canada and Mexico respectively, this next generation of trade deals provides the opportunity to set new benchmarks in areas like digital trade, climate and women’s economic empowerment, and cement the UK’s position as world leader in digital and services trade.
The call for input will provide businesses, public sector bodies, individuals and other interested stakeholders with the opportunity to give valuable feedback and highlight their priorities for our future trading relationship with these two countries.
The feedback received from stakeholders will be crucial when shaping our mandate, and will inform detailed negotiations preparation, and policy positions. The Department for International Trade is committed to ensuring future FTAs and their provisions are informed by stakeholder needs and shaped by the demands of the British economy.
The UK is to begin negotiations for upgraded trade deals with Canada and Mexico this year focused on creating even greater opportunities for UK businesses. Our new negotiations will allow us to go further to boost trade with these economies. Canada was the UK’s 15th largest export market in 2019, and according to IMF data, Mexico ranks as the 15th largest economy worldwide, with a market of over 130 million consumers, offering significant opportunities for UK businesses in industries including automotive manufacturing and food and drink.
Forging stronger trade links with Canada and Mexico will also support the UK’s accession to the comprehensive and progressive agreement for trans-Pacific partnership (CPTPP), as they are both members. CPTPP is at the cutting edge of global trade and will remove barriers, raise standards and support jobs, putting the UK at the centre of an increasingly influential and modern trade network of 11 economies in the Indo-Pacific region with a combined GDP of almost £9 trillion in 2019. Joining will help open up a new horizon of opportunities for British businesses, particularly in services and digital and data provisions. Canada and Mexico also represent the second and fourth largest economies out of the CPTPP countries, which in total account for 13% of global GDP. This would increase to more than 16% if the UK were to join.
The UK and our partners in Canada and Mexico share a desire to launch negotiations later this year. The call for input will strive to support the goal of greater economic prosperity for businesses and it will ensure that their needs are heard. The Government are committed to transparency and will ensure that Parliament, the devolved Administrations, UK citizens and businesses have access to information on our trade negotiations.
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