A free trade agreement (FTA) between the UK and the GCC (Gulf Co-operation Council) is likely to be signed soon, UK Minister of State for Trade Policy Greg Hands has said.
Talking exclusively to the GDN during his visit to Bahrain yesterday, Mr Hands confirmed that good progress was made during the fifth round of negotiations held in Riyadh in November 2023, with draft treaty text advanced across most chapters.
He expects the sixth round of negotiations to take place in London at the end of January 2024.
Mr Hands confirmed that good progress was made during the fifth round of negotiations held in Riyadh in November 2023, with draft treaty text advanced across most chapters.
Reiterating the UK’s desire for an ambitious, comprehensive, and modern agreement, Minister Hands said he saw the agreement as a “substantial economic opportunity” and a significant moment in the UK-GCC relationship.
He believes it will boost trade, create jobs, and strengthen ties between the two regions.
A UK government analysis found that a free-trade agreement between the UK and the GCC would be expected to increase trade by more than 16 per cent and add at least £1.6 billion ($1.98bn) a year to the UK economy.
Total trade between UK and the GCC was worth £61.5bn according to latest figures.
“Eliminating tariffs and other trade barriers would boost trade between the UK and the GCC, leading to economic growth and job creation in both regions. The UK imports various goods from the GCC, such as oil, gas, petrochemicals, and aluminium, while exporting consumer goods, machinery, and financial services. This trade could become more efficient and cheaper with an FTA,” Mr Hands explained.
Lower trade barriers and a more predictable legal framework could attract increased foreign investment from the UK and other countries to the GCC.
The UK has a strong services sector, including finance, consulting, and education. An FTA could give the GCC easier access to these services, helping them develop their own economies and build capacity.
According to the minister, Bahrain is a strategically placed trading hub within the GCC, and reduced tariffs or their elimination under an FTA could lead to a significant boost in trade volume with the UK.
“With its established infrastructure and business-friendly environment, Bahrain could benefit from becoming a regional hub for companies looking to access the wider UK and GCC markets under the FTA. This could further position Bahrain as a key trade and investment destination,” said Mr Hands.
He further said increased collaboration with the UK in areas like finance, technology, and education could enhance Bahrain’s workforce skills and improve its competitiveness in the global market.
“Easier access to the UK market could attract more foreign investment and create new jobs in Bahrain. This could be particularly beneficial for sectors like logistics, tourism, and renewable energy,” Mr Hands added.
avinash@gdnmedia.bh
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