In a new Asia House Research briefing, Freddie Neve, Middle East Associate at Asia House, explores the state of UK-GCC free trade agreement negotiations – including potential obstacles to a deal and what could feature in a future FTA.
The UK government has staked much political capital on forging an independent trading policy post-Brexit, with free trade agreements (FTAs) central to this strategy. The UK wants FTAs to cover 80 per cent of its cross-border trade by 2022 and has its sights on the Gulf Cooperation Council (GCC) as a key market to help realise this ambition, recently concluding a public consultation on GCC trade in January 2022.
A comprehensive FTA with the GCC – comprising Saudi Arabia, the UAE, Kuwait, Bahrain, Qatar, and Oman – would represent a major milestone in the UK’s post-Brexit global trade agenda. The GCC is the UK’s 10th largest trading partner. Bilateral trade reached £41.4 billion in 2019 but has since fallen to roughly £32.4 billion in 2020 due to the COVID-19 pandemic. The UK also enjoys a notable trade surplus with the GCC worth around £13.8 billion in 2020, creating incentives to broker a deal (see chart). However, there are a range of factors that could prove obstacles to an agreement.
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