Kemi Badenoch Travels to the Gulf to Strengthen Trade Relationships

During her visit to Qatar, Saudi Arabia, and the United Arab Emirates this week, Business and Trade Secretary Kemi Badenoch will engage in discussions aimed at encouraging Gulf Cooperation Council (GCC) Ministers to advance the UK’s goals for a modern, comprehensive trade agreement.

In meetings with her ministerial counterparts in each country, as well as new GCC Secretary General Jasem Al-Budaiwi, Badenoch will also connect with senior business leaders and investors to foster inward investment in the UK—currently exceeding £15.7 billion—fulfilling the government’s priority of economic growth.

Before her trip, Business and Trade Secretary Kemi Badenoch stated:

Our trade and investment relationship with the Gulf nations is already robust, but I’m committed to enhancing it even further.

The GCC offers enormous potential for UK companies, whether it’s introducing outstanding British food and drink products into new markets or providing fresh consumers for our thriving digital trade and renewable energy sectors.

I am confident that my counterparts share the same ambition for this agreement, and I’m prepared to match their aspirations.

This visit occurs as total trade between the UK and GCC hit a historic high of £61.3 billion in 2022.

Negotiations with the six-country bloc began in 2022, with three rounds of talks already completed.

The GCC now ranks as the UK’s seventh largest export market. Demand for goods and services from this region is anticipated to surge to nearly £1 trillion by 2035—an increase of over 75%.

This growth will create significant new opportunities for UK businesses, spanning sectors such as food and drink, automobiles, and apparel. Reducing tariffs as part of a trade agreement will enhance choice for GCC consumers and broaden access to a wider array of UK products. This will stimulate job creation nationwide and assist businesses in expanding, thereby boosting the economy.

An agreement with the GCC will further leverage the UK’s strengths as a leader in global services. UK exports to the GCC totaled £36 billion, with over half attributed to services.

Innovative green technology companies based in the UK are already capitalizing on the region’s transition away from fossil fuels. Pioneering firms like Levidian Nanosystems, Sonihull, Graphene Solutions, and G-volution are advancing sustainability and clean energy solutions and have broadened their operations to the Gulf as the region diversifies its economy.

Levidian Nanosystems CEO John Hartley remarked:

The GCC is a key region for Levidian—its combination of large-scale gas assets in need of decarbonization, heavy industry benefiting from graphene applications, and a political commitment to rapid decarbonization positions it as an area where Levidian can make a significant impact.

The Business and Trade Secretary is scheduled to address the Qatar Economic Forum on Tuesday and participate in a series of business engagements throughout the week.

Background:

• As of 2020, UK firms had at least £13.4 billion invested in GCC economies, while GCC firms invested at least £15.7 billion in the UK. These figures only partially represent the size of the UK-GCC investment relationship due to data limitations.
• A GCC Free Trade Agreement can include tailored chapters with each individual nation. The third round of negotiations concluded in March, with the fourth scheduled for later this year.
• In 2022, food and drink exports to GCC markets reached £877 million, marking a more than 40% increase in current prices from £625 million in 2021. Key exports include whisky, cereals, and chocolate. The FTA aims to eliminate non-tariff barriers related to labeling and marking, facilitating easier trade for more UK food manufacturers while ensuring compliance with local regulations.
• The UK is the world’s second-largest services exporter, with top service exports to the GCC in 2022 including other business services (£4 billion), travel services (£2 billion), and financial services (£746 million). UK service exports to the GCC rose by 48%, or £6 billion in current prices, in 2022 compared to 2021. Services comprise 67% of total exports to Saudi Arabia, establishing it as our 10th largest service export market globally.
• Regions and nations across the UK are poised to gain from a trade deal with the GCC, particularly communities outside of London, such as the East Midlands, West Midlands, North East, and Yorkshire and the Humber, which are set to enjoy the greatest relative increases.