UK-GCC FTA Negotiations Make Significant Progress

Chief Negotiator tells Asharq Al-Awsat deal will increase trade 16%

Tom Wintle, Chief Negotiator UK-Gulf Cooperation Council FTA, and Acting Chief Negotiator for the GCC Fareed bin Saeed Al-Asaly. (Asharq al Awsat)
Tom Wintle, Chief Negotiator UK-Gulf Cooperation Council FTA, and Acting Chief Negotiator for the GCC Fareed bin Saeed Al-Asaly. (Asharq al Awsat)
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UK-GCC FTA Negotiations Make Significant Progress

Tom Wintle, Chief Negotiator UK-Gulf Cooperation Council FTA, and Acting Chief Negotiator for the GCC Fareed bin Saeed Al-Asaly. (Asharq al Awsat)
Tom Wintle, Chief Negotiator UK-Gulf Cooperation Council FTA, and Acting Chief Negotiator for the GCC Fareed bin Saeed Al-Asaly. (Asharq al Awsat)

Chief Negotiator – UK-GCC FTA, Department for International Trade Tom Wintle revealed that the UK and Gulf Cooperation Council (GCC) countries have made “good progress” in negotiations to sign a free trade agreement (FTA).

Speaking on the eve of the third round of talks kick off between the parties in Riyadh, he told Asharq Al-Awsat that both sides are eager to strike an ambitious, comprehensive and modern deal.

He estimated that the deal would help increase trade between the UK and GCC by no less than 16% and increase the UK’s GDP by around £1.6 billion.

What does the UK aim to achieve from this third round of negotiations in Riyadh?

My team and I are excited to be in Riyadh for Round 3 of negotiations. We have made good progress so far and we want to keep the momentum going. This week we have an opportunity to work with GCC colleagues to build on our work and tackle some of the more challenging parts of the deal.

A free trade agreement (FTA) between the UK and GCC will be a substantial economic opportunity for all of our countries, and a significant moment in the UK-GCC relationship.

How many negotiators are involved from both sides?

In total, more than 100 UK negotiators from across our government are taking part in this round of negotiations. Round 3 is taking place in a hybrid fashion, with a number of UK negotiators travelling to Riyadh and others taking part virtually. We expect similar numbers of GCC negotiators.

How optimistic are you regarding reaching a deal? And do you have a targeted timeline for concluding the negotiations and signing the deal?

There is strong political will on both sides. The UK and GCC have committed to negotiate an ambitious, comprehensive and modern free trade agreement fit for the 21st century. We’ve made significant progress for such an early stage of negotiations and have discussed every policy area in negotiations so far.

We have always been clear that negotiating an ambitious agreement is more important than meeting any particular deadline. Our aim is to secure a deal that delivers the maximum possible benefit for businesses on both sides.

If a deal is signed, what impact will it have on trade between the UK and the GCC?

A UK-GCC FTA will be mutually beneficial for the UK and GCC economies. Our economies complement one another and there is limited direct competition between our businesses. A trade deal will strengthen supply chains, helping to grow the domestic industries that we each are specialized in.

Our analysis shows that a deal is expected to increase trade between the UK and the GCC by at least 16% and increase UK GDP by around £1.6 billion in the long run. A highly ambitious FTA, which the UK is pushing for, could deliver even greater gains. So, the more ambitious we are in negotiations, the greater the gains for everyone. It is a win-win scenario.

Which policy areas are discussed in the negotiations? And which are excluded?

We have discussed all areas that are included in some of the most ambitious and modern FTAs that have been agreed upon around the world in recent years. This involves going beyond the arrangements we already have in place to remove barriers, improve the business environment and make it easier to invest in each other’s economies. We have also discussed working together on modern areas of trade, such as innovation, digital and the environment.

We are keen to do a deal that would bring the biggest possible benefits to UK and GCC businesses. An FTA can support the GCC countries’ Vision Plans and enhance the private sector's ability to drive economic growth. We have genuinely complementary economies and there are exciting opportunities in all sectors.

The GCC is equivalent to the UK’s seventh largest export market. A deep, comprehensive FTA with the whole bloc will deliver the greatest economic and strategic benefits for both sides.

Our priority is an ambitious agreement with the whole of the GCC and there is strong political will from all sides. Within this agreement, there is the opportunity to secure additional commitments where some members can go further. We will make full use of these opportunities to ensure we maximize the benefits with individual GCC Member States.

Has Brexit bolstered the UK’s negotiating position?

The UK took control of its trade policy when we left the European Union. We are the fifth biggest economy in the world and the second biggest services exporter. Now we are independent we can negotiate modern, comprehensive and ambitious FTAs with partners like the GCC.

We have already signed trade deals with 71 countries, plus the European Union that account for £814 billion of trade, and we are now negotiating new deals with GCC, India, Canada, Mexico and Israel.

By the same token, do current economic woes in the UK weaken its negotiating hand?

The UK was the fastest-growing economy in the G7 last year, with capital investment at record levels of around £600 billion maintained over the next five years. We are the sixth biggest investor in the GCC, with a total of £31 billion invested in the last 20 years. Our bilateral trading relationship increased by 76% according to the latest annual figures, from £23.6 billion to £54.5 billion. However, the real strength of our relationship is measured in decades and centuries: ours is a long-term partnership, not one based on economic cycles.



Trump’s Copper, Aluminium Tariffs May Raise Costs for US Consumers 

President Donald Trump speaks to reporters aboard Air Force One en route from Miami to Joint Base Andrews, Md., Monday, Jan. 27, 2025. (AP)
President Donald Trump speaks to reporters aboard Air Force One en route from Miami to Joint Base Andrews, Md., Monday, Jan. 27, 2025. (AP)
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Trump’s Copper, Aluminium Tariffs May Raise Costs for US Consumers 

President Donald Trump speaks to reporters aboard Air Force One en route from Miami to Joint Base Andrews, Md., Monday, Jan. 27, 2025. (AP)
President Donald Trump speaks to reporters aboard Air Force One en route from Miami to Joint Base Andrews, Md., Monday, Jan. 27, 2025. (AP)

President Donald Trump's vow of tariffs on US copper and aluminium imports would result in higher costs for local consumers because of a shortfall of domestic production and the length of time it would take to renew the industry, analysts and industry participants said on Tuesday.

In a speech to Republican lawmakers on Monday, Trump said he would impose the tariffs on aluminium and copper - metals that are needed to produce US military hardware - as well as steel, to entice producers to make them in the United States.

"We have to bring production back to our country," he said.

Trump won the US presidency in November vowing to lower costs for consumers still smarting from an inflation surge in the first half of his predecessor Joe Biden's term. However, analysts argue his plan for tariffs on imports to bolster the country's manufacturing sector, another of his promises, may undercut his price-cutting pledge.

It was not clear how broadly the tariffs could be applied, but several mining CEOs have previously said they are preparing for different scenarios as markets brace for a potential change to trade flows.

"There’s a few unknowns here. Will these tariffs be enacted, and at what scale, and who will pay? Ultimately, they generally get paid by the consumer particularly in the case where there’s no domestic substitute," said analyst Daniel Morgan at Sydney investment bank Barrenjoey.

US aluminium and copper smelters have been closing and would need new infrastructure and power contracts to restart, among other measures, all of which take time, he said.

Aluminium producers in Canada such as Rio Tinto and Alcoa would be unlikely to take revenue hits, instead the costs would likely be rolled to automakers who would then pass them to US consumers, he added. Rio Tinto declined to comment.

An Alcoa spokesperson pointed to comments from CEO William Oplinger from a results call last week that flagged the potential for "wide ranging effects on supply, demand and trade flows". He estimated that a 25% tariff on current Canadian export volumes to the US could represent $1.5 billion to $2 billion of additional annual costs for US customers.

An executive at India's top mining lobby group noted the US is the biggest export market for its aluminium, and it expects India's government to take action by convincing Trump not to issue any levies.

"If Trump imposes tariffs, it will have an adverse impact particularly on aluminium because Europe is already on path to impose a carbon tax and the UK might do it too," said B.K. Bhatia, additional secretary general at the Federation of Indian Mineral Industries.

On copper, John Fennell, CEO of the International Copper Association Australia said any tariff on imports to the US would impact its industry given the country is a net copper importer, although it may speed the development of new mines such as Rio Tinto's Resolution in Arizona.

"This could be good for new mines like Resolution but that is many years off, and the pain would be felt by local manufacturers paying the tariffs in the interim," he said.

Freeport-McMoRan CEO Kathleen Quirk said last week that the miner would not be affected by any copper tariffs as they sell all their US copper domestically and their Indonesian metal goes to Asia. But she worried about any potential inflationary effects of copper tariffs.

In Japan, the world's third-largest steel maker, steel and aluminium tariffs during Trump’s previous term had a limited impact, noted Tomomichi Akuta, senior economist at Mitsubishi UFJ Research and Consulting.

"The majority of Japan's steel exports are value-added specialty products. And since value-added products were excluded, we expect a similar approach this time. These value-added products are difficult to substitute, making them less likely to be targeted," Akuta said.