Mark Carney’s Global Trade Push: What SMEs Should Know

1. What’s Happening? High-Level Trade Talks

Carney is publicly advocating for deeper cooperation between the EU and the CPTPP — a 12-nation pact spanning the Indo-Pacific that includes Canada, Japan, and Australia among others — with the goal of better linking supply chains and aligning certain trade rules. The idea is to build a rules-based trade alliance covering many markets without direct U.S. participation.

This initiative follows Carney’s speech at the World Economic Forum in Davos, where he urged “middle powers” — countries that are neither dominated by nor part of the biggest economic blocs — to collaborate more tightly to protect shared economic interests.

Status: Conversations are ongoing and exploratory, not yet formal negotiations toward a binding agreement.

2. Why It Matters to Global SMEs

For SMEs, international trade success often hinges on navigating complex rules, tariffs, and supply chain barriers. If the EU and CPTPP economies move toward closer alignment, several potential advantages could emerge:

✔ Simplified Rules of Origin

If supply chains and origin rules are aligned, SMEs exporting goods across the two blocs could face less complexity and paperwork to qualify for tariff reductions.

✔ Lower Barriers Across More Markets

A more coordinated trade framework may reduce regional fragmentation, enabling SMEs to scale exports beyond their home markets with fewer regulatory differences to manage.

✔ Greater Predictability

In times of fluctuating trade policies and rising tariffs, coordinated trade rules can offer more predictability, an asset for planning production, pricing, and logistics.

Note: None of these benefits are guaranteed yet — they depend on whether alignment talks progress into concrete frameworks.

3. Current Limitations & Realities

Despite widespread reporting on this initiative, it is important to be clear about what is not yet established:

· No Final Trade Pact: There is no formal EU–CPTPP trade agreement yet — just discussions and exploratory engagement among officials.

· Still Early and Complex: Bringing together over 40 economies across multiple continents involves aligning diverse legal systems, standards, and market priorities — a process that typically takes years.

· Rules-Based Integration, Not a Supranational Union: The current emphasis is on coordinating existing frameworks rather than creating a new international economic institution or single market.

4. Global Trade Trends SMEs Should Watch

Even if the EU–CPTPP alignment effort remains exploratory, related developments could still affect SMEs:

· CPTPP-EU dialogue: Governments have already undertaken a Trade and Investment Dialogue to uphold open markets and rules-based systems.

· Rising protectionism: Tariffs and trade policy shifts — especially under the current U.S. administration — are driving countries to seek new partners.

· Diversification efforts: Canada and others are expanding trade ties across Asia and Europe to reduce dependency on single markets.

Understanding these trends can help SMEs anticipate shifts in market access and regulatory landscapes.

5. SME Takeaways: Actionable Steps

Even at this early stage, SMEs can prepare to benefit if deeper alignment evolves:

1. Monitor Regulatory Changes: Stay updated on trade discussions between the EU and CPTPP economies.

2. Review Supply Chain Flexibility: Evaluate how rules of origin and supply sourcing could be optimized.

3. Identify Target Markets: Prioritise planning for markets where alignment could reduce entry barriers.

4. Invest in Trade Compliance: Tools that handle tariffs, certificates, and documentation can future-proof operations.

6. Bottom Line

Carney’s global trade initiative remains at the discussion phase, but it reflects a broader shift toward coordinated economic partnerships beyond traditional centres of power. For SMEs, this means potential new opportunities for export and growth, but also a need for informed planning and flexibility as global trade frameworks evolve.