Simon Penney said the UK will seek to establish a free trade agreement with the GCC
The United Kingdom’s withdrawal from the European Union will be a “very positive story” for the GCC and for British companies that are doing or hope to do business in the region, according to Simon Penney, Her Majesty’s Trade Commissioner for the Middle East, Afghanistan and Pakistan.
In an interview with Arabian Business, Penney said getting a greater number of British firms to do business outside the EU forms a significant part of the government’s aim of increasing trade’s contribution to GDP from 30 to 35 percent.
“We’re not going to do that with the existing number of companies that export,” he said. “A very significant focus of our export strategy [is getting] more companies to focus [on exports].”
Penney said that there are approximately 400,000 export-ready firms in the UK that do not currently export.
Getting British businesses to do business in the UAE, he added, will be made helped by the relative ease of doing business in the country, where about 6,000 UK firms already are present.
“Our job in the region...is to identify and provide opportunities for those companies to export,” he said.
While Penney said that current discussions surrounding Brexit and the conditions of the UK’s withdrawal are “incredibly politically charged”, it will ultimately benefit the region.
“If you look beyond withdrawal and look at the basis on which the UK will trade going forward, I think it’s a very positive story, certainly for this part of the world,” he said.
In the immediate aftermath of Brexit, however, Penney said that the relative ease of doing business in the GCC, largely due to low tariffs, means that the British government will focus more on bilateral areas of the relationship in which countries can work together such as food import regulations.
“These are non-tariff barriers. They are more mechanical things that you can resolve today. You don’t need a free trade agreement and you don’t need to leave to EU to sort these things out,” he said. “As far as we see things at the moment, it’s very much business as usual in the immediate aftermath of Brexit.”
Penney added that, in the future, it is “clearly our ambition to have a free trade agreement with the GCC.”
“That is something that we will look towards at some point, but for now it’s not essential to doing business,” he said.
According to British government statistics, the Gulf region accounts for £40 billion ($50.83 billion) of the UK’s £45 billion ($57.19 billion) worth of trade with the Middle East. Of this, trade with the UAE accounts for £17.5 billion ($22.24 billion).