UK launches preparations for Arabian Gulf free-trade deal

Lord Edward Lister tells business forum that partnership with UAE is unprecedented

Dubai. The UAE's economy is set to grow by 2.5 per cent this year and 3.5 per cent next year, according to estimates by the country's Central Bank. Getty

Lord Edward Lister, a former Downing St chief of staff, has revealed that the UK has started formal steps for a free-trade agreement with the Arab Gulf countries.

Mr Lister, co-chair of the UAE-UK Business Council, told an online forum on Wednesday that unprecedented developments in forging trade links were coming.

"There is a lot of work under way at the moment – consultation is shortly about to start on it – on new trade arrangements into the Gulf, which will be a free-trade agreement," he said. "That's a major piece of government work."

Ahmed Al Sayegh, Minister of State and the other co-chair of the Business Council, told the forum that as the UAE reaches its 50th anniversary, the two countries' "friendship was going through a revival at the moment".

Mr Al Sayegh said the UAE and the UK were leading the world in vaccination rates and were optimistic of recovery from the setback brought on by Covid-19.

"This is such a pivotal year for both countries and it offers us an unprecedented opportunity for growing our trade and investment relationship," he said.

"We have both take great strides in addressing the Covid crisis by vaccinating and hopefully our economies will be growing back through the investments we are making in infrastructure, technology and skills."

Since completing the process of leaving the EU this year, Britain has sought to close trade deals with major economic partners.

Officials have spoken of the UK's ambition to seal a GCC trade deal on terms of better access and more positive conditions for investment.

Mr Lister, 71, has worked with UK Prime Minister Boris Johnson since he was elected mayor of London in 2008, stepping down as the official envoy to the Gulf late last week.

He has said it was "the right time" for him to go because it was clear the role was bigger than the part-time job he envisaged.

The two governments signed a strategic investment partnership agreement in March, with Mubadala Investment Company committing to invest £800 million ($1.11 billion) in the British life sciences industry over the next five years.

Mr Lister said recovery from the pandemic would bring a more resilient economy with greater investment in infrastructure, training workforces and new trade relationships.

London is seeking to rebalance its economy by embracing some of the principles shown by the UAE.

The pandemic uncovered frailties in the British system, which the government aims to repair.

"We've all learnt some terrible lessons from Covid," Mr Lister said. "We've got to have a much more resilient supply chain in place.

"The number one area there is food security and agricultural technology.

"The 'build back better' policy of the prime minister is a desire to increase economic production, particularly in the regions of Britain."

Mr Lister said the March deal signed with Mubadala was a rare example of the UK government investing jointly with a wealth fund for growth opportunities.

"I think that gives us lots and lots of opportunities," he said.

Badr Al Olama, executive director of Mubadala’s UAE clusters, said his work would identify investment opportunities and enable strategic partnerships between the UAE and UK.

"We want to develop the new dynamic sectors such as energy transition and life sciences," Mr Al Olama said. 
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