LONDON — In a world blighted by tariffs and increasing protectionism, U.K. Prime Minister Keir Starmer is starting to realize that teamwork really is the only way to make his free trade dream a reality. “I do think that it’s [a] difficult environment, but there are significant opportunities if we’re agile about it, if we understand the world we’re living in, and get ahead of the curve,” Starmer told businesses in Westminster on Thursday as he set out the U.K.’s first Trade Strategy since Brexit. While underscoring the importance of trade deals with the likes of India and the U.S., Starmer hinted at a more multilateral approach to trade policy. “I think we should also talk to like-minded countries, because they recognize that the world is changing,” he said. “I’ve been talking to the leaders in Japan, in Singapore, in Australia, New Zealand, Canada, about how we, the U.K., can trade in an easier and better way with them and whether we as a group of countries can trade with other countries in an easier and better way.” The countries mentioned are all members of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), an Asia-Pacific trading bloc which the U.K. joined in December. ASIA-PACIFIC BLOC ‘MORE IMPORTANT THAN EVER’ Starmer’s words were borne out in the government’s new trade strategy, where the U.K. committed to working alongside partners and allies to negotiate and agree an “ambitious agenda for future plurilateral agreements.” It describes the role of groupings such as CPTPP as “more important than ever in the current global context.” “We will use CPTPP as a platform to support the wider multilateral and plurilateral system, and to encourage deeper trading relationships between countries and groupings committed to liberal rules-based trade,” the strategy said. At a recent meeting in Korea, CPTPP members committed to work with the EU and the Association of Southeast Asian Nations — a regional grouping of 10 states in Southeast Asia — to liberalize global trade in light of “significant challenges” facing the international trading environment.   This could include discussions on areas such as tariffs, digital trade, rules of origin, supply chains, customs administration and innovation, the Trade Strategy said, adding that these dialogues could “create a platform for other trade-focused economies to participate, so broadening our network of collaborative partnerships.” In another sign of the U.K.’s commitment to a multilateral trading system, the U.K. announced it would join the World Trade Organization’s Multi-Party Interim Appeal Arbitration Arrangement (MPIA), an alternative system for resolving WTO disputes. The U.K. had previously dragged its heels on signing up to the mechanism. “Joining MPIA sends a clear signal that the U.K. is committed to the principles of free and fair trade and that we will champion progress wherever and whenever necessary,” the strategy said.

LONDON — Britain’s trade chief is confident he can lower U.S. President Donald Trump’s 10 percent “reciprocal tariffs” on imports of U.K. goods. “There’s no doubt in my mind we can get progress on reciprocal tariffs,” Jonathan Reynolds said in response to a question from POLITICO at the British Chambers of Commerce Global Annual Conference in London. The U.K.’s business and trade secretary also said he has “no doubt” that the U.S. administration will lower 25 percent tariffs on British steel and aluminum imports, as part of the trade pact Prime Minister Keir Starmer struck with Trump early last month. “The issue with implementation of the steel agreement is the melt and pour rules, which is the U.S. interpretation of rules of origin around steel,” Reynolds said. The rules require steel imported to the U.S. to be manufactured in its country of origin. However, furnaces at Tata Steel UK’s Port Talbot steel mill — the largest steel exporter in the U.K. — are shut for several years as the firm transitions to greener tech. That means the company is importing steel from its plants in India and the Netherlands. Implementing the deal with Trump “is very much about making sure Port Talbot gets the benefit of it as well,” Reynolds said, with the U.K. pushing for exemptions. Reynolds spoke during the launch of the government’s Trade Strategy which sets out plans to seize new powers to protect steel and other domestic industries. Starmer’s special adviser on business, Varun Chandra, has been in Washington this week to progress further talks and U.S. implementation of the deal. The U.S. has set a deadline of July 9 for trade talks with a number of countries. Lowering Britain’s digital services tax on the revenues of search engines, social media and online marketplaces is not part of the ongoing negotiations, Reynolds said. “In the wider discussions, you know U.S. concerns about digital services tax have been there,” he said. “But I think it’s always been wrong to portray the U.S. position as somehow demanding a reduction in tax for U.S. tech companies in exchange for trade access, export access to the U.S.”

LONDON — The U.K. government will consult businesses on whether Britain should join a European customs agreement to simplify rules around international supply chains. The Pan-Euro-Mediterranean customs convention (PEM) relaxes rules of origin — useful for firms with international production chains that cross borders. The government’s Trade Strategy published on Thursday morning says that joining PEM would “increase flexibility for UK exporters where they source their inputs.” The agreement adds: “The question of UK accession therefore merits further review, and this is reflected in feedback from business. We will now engage business and PEM members to consider the benefits of joining PEM.” But the document says the government recognizes “that PEM rules could have varying effects on businesses” and says it will assess “whether we are using our current trading relationships with these partners to best effect.” PEM covers the 27 EU member states, as well as dozens of other countries in the region ranging from Turkey, Morocco and Syria to Serbia, Moldova and Ukraine. The agreement is not a customs union, and the U.K. would still retain an independent trade policy and set its own tariffs and quotas. But it would mean businesses such as car manufacturers sourcing parts of their products from other PEM countries would face less red tape. RULES OF ORIGIN Under international trade rules, products can only benefit from the low tariffs in free trade agreements if they are actually made in the countries that are party to the agreement. However, if a product is made in more than one country then “rules of origin” determine whether it counts as domestically produced or a foreign import — usually by looking at how much value has been added where. Under PEM, companies can sometimes count inputs from other PEM members as domestic production — giving them more flexibility on where they source inputs from without risking being hit by tariffs. Not all businesses support membership as some would see their competitors get a competitive advantage. In January Trade Minister Douglas Alexander noted there are “some stakeholders who would argue that there would be disadvantages to sectors of U.K. business if we were to rejoin.” But he added: “It is an issue that we are open to looking at, because we want to take a pragmatic view as to where the national interest lies.” EU Brexit chief Maroš Šefčovič said at the time that British membership of the convention was “something we could consider.”