Post-Brexit Britain: Is joining the Pacific Trade Group a good idea?
The International Trade Secretary, Liam Fox (pictured above), recently suggested that joining the Pacific Trade Group (TPP) would be a plausible possibility for the UK post Brexit, regardless of the lack of proximity to other joining member states.
The TPP was founded in 2016 by twelve countries, in which represent 40% of the world’s economic output, acting under the pretensions to become a new unified single market, much like the structure present within the European Union.
However, would it really be a viable option for Britain to join a similar trading structure to a single market, whilst it is still trying to negotiate its way cleanly from the single market of the EU?
One of the positive elements to Britain joining the TPP could be its relevancy to the evolution of international economics that is currently ongoing within a rapidly developing globalised world.
For instance, if Britain were to join the TPP, this could impact the standard economic factors that are considered within the creation of trade pacts, such as the value of geographical proximity within trade, as promoted by the commonly used ‘Gravity Model’ within economics.
This is because the economic ‘Gravity Model’ demonstrates that the flux of trade can be predicted based upon the geographical proximity between its joining member states. However as Britain does not have a close geographical proximity with the other member states within TPP, by joining the TPP it could be argued that the value of proximity no longer holds any precedence.
Thus, if Britain were to join the TPP, this hypothetically could create a ‘domino’ effect, in which could re-arrange the entire system of global economics, regarding the values that are attributed towards the creation of trade deals.
Furthermore, this could ultimately be a positive domino effect, due to the ever-increasing evolution of technology and globalisation occurring, in which the value of proximity within trade deals is becoming increasingly obsolete regardless, particularly as physical barriers are being overridden by digital ones.
Therefore, if proximity within trade no longer has any important value when creating trade pact deals between nations, then how long will it be before the concept of member states joining specific trade pacts becomes a thing of the past?
For instance, would the diminishing of the value of geographical proximity ultimately pave the way to a global trade pact between all countries, devaluing the concept of nations in regard to physical geographical location, altogether?
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Author: Portia Vincent-Kirby