After a pause for the UK's general election, Britain's new Labour government has said it is eager to restart talks towards securing a free-trade agreement with the Gulf Co-operation Council and others.
Given that the UK was the world’s fourth largest exporter in 2022 with exports of £855 billion, and growth is a central pillar of Prime Minister Keir Starmer's economic strategy, international trade is high on the list of priorities.
Business and Trade Secretary Jonathan Reynolds announced it was the government’s intention to launch a new trade strategy to help deliver its growth mission, beginning with talks with the GCC, India, Israel, South Korea, Switzerland and Turkey.
“From the Gulf to India, our trade programme is ambitious and plays to the UK’s strengths to give British businesses access to some of the most exciting economies in the world,” Mr Reynolds said.
“Our teams will be entering negotiating rooms as soon as possible, laser-focused on creating new opportunities for UK firms so they can support jobs across the country and deliver the growth we desperately need.”
'Eager to open the doors'
The sixth round of FTA talks between the UK and the GCC – which is made up of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the UAE – ended in February, and the new Labour government expects the next round to take place later this year.
During the sixth round, discussions centred on 21 policy areas over 30 sessions, with “good progress” being made and both sides remaining “committed to securing an ambitious, comprehensive and modern agreement fit for the 21st century”, according to a government statement at the time.
The GCC and the UK already have a trade relationship where, as of 2021, at least £19 billion had already been invested in each other’s economies.
Total trade between the GCC and the UK is worth about £59 billion, according to the latest estimates.
An FTA with the GCC could potentially boost this further, the government said, “ensuring British companies can make the most of this booming market and British customers get even more choice”.
British business groups welcomed the move to restart the trade talks, with William Bain, head of trade policy at the British Chambers of Commerce (BCC) commenting that companies “were eager to open the doors to closer trade links with our key partners”.
“Reaching new or upgraded deals could offer new opportunities for businesses, of all sizes, to grow and invest for the future, especially in sectors like spirits, business services, climate-friendly technology and pharmaceuticals,” he said.
The UK already has FTAs with Israel, South Korea, Switzerland and Turkey, which rolled over when Britain left the EU in 2020. Before the UK election, the talks with the four countries were aimed at updating the agreements.
