Britain seeks 'new era' after trade talks with GCC

All six Gulf states represented during day of in-depth talks at foreign secretary's mansion in Kent

Britain's Foreign Secretary Liz Truss, centre, poses for a photograph with members of the Gulf Co-operation Council at Chevening House. Photo: Alice Hodgson / No 10 Downing Street

Britain and the Gulf States signalled they were “setting the stage of a new era” for economic ties following a meeting of foreign ministers on Monday.

The countries will also begin substantive talks on a free-trade agreement in the new year, it was announced after the Gulf’s foreign ministers gathered at Chevening House in Kent in a day-long meeting with Liz Truss.

Speaking at her 17th-century grace-and-favour mansion, following talks with the Gulf Co-operation Council ministers Britain's foreign secretary said an agreement was a “win-win for all parties".

“I want us to have much deeper links in key areas like trade, investment, development and cybersecurity with a part of the world that is important to Britain’s long-term interests,” she said.

The British government wants to “modernise the relationship” with the Gulf, moving it on from the long tradition of security into the business world, with annual trade worth £30 billion.

During Monday's meeting the ministers also agreed to much closer co-operation on trade, cyber security and green infrastructure investment into low and middle-income countries.

The countries will also work together to boost “clean, reliable, honest infrastructure financing into the developing world,” the Foreign Office said in a statement.

It was also a moment for both sides to explore the growing shared opportunities offered by green energy. With Gulf funding and British technology, particularly in wind power, there is a strong desire to help developing countries — in East Asia as well as Africa — to move away from fossil fuels into renewables.

Ms Truss, who has gained considerable experience from striking deals around the world as international trade secretary, will seek in the coming year to seal a free-trade agreement with the Gulf.

“Closer economic and security ties with our Gulf partners will deliver jobs and opportunities for the British people and help make us all safer,” she said.

“Co-investing with the Gulf in infrastructure will help low and middle-income countries being strategically dependent on any one provider, while also boosting clean growth and encouraging enterprise and innovation to flourish.”

The foreign secretary is also keen to harvest economic benefits post-Brexit, seeing Britain’s service industry as an area for expansion into the Gulf.

The formal process for an FTA will begin after the consultation period ends at the end of January and serious discussion can start with the bloc’s six countries.

Despite the Omicron outbreak, the foreign ministers of Oman, Saudi Arabia, Qatar, Bahrain and Kuwait were present with the UAE represented by Assistant Minister for Political Affairs at the Ministry of Foreign Affairs and International Co-operation Lana Zaki Nusseibeh.

Sultan Haitham of Oman was also in London last week to meet Boris Johnson and Queen Elizabeth.

On the back of the Cop26 climate summit in Glasgow, there is a global realisation about the economic benefits of investing heavily in wind farms, solar power, electricity and other non-fossil fuel alternatives. Working together to help neighbouring states and other nations, Britain hopes the GCC can become a partner in meeting worldwide and regional needs.

Iraq in particular is seen as a post-conflict country that could be stable enough to build significant green energy infrastructure, and discussions on the nation's reconstruction are being pushed forward.

A series of high-level visits to the region over the next year will be used to further cement Britain's GCC relationships and help to move the trade deal along.

A trade agreement with the bloc might be concluded by the end of 2022, But given the number of countries involved, London has not ruled out striking bilateral deals, in particular with close allies such as the UAE.

Leading MPs say that given the UAE’s international standing, with the space mission to Mars, its modernised armed forces and technology investment, a trade deal is a natural progression.

David Jones, chairman for the UAE’s All Parliamentary Party Group, sees it as a natural progression from the enduring defence ties Britain shares with the region.

“Our relationship is well founded in history with Britain and we have significant business interests throughout the region and in return the Gulf states have been major inward investors into the UK,” he said.

He also referred to the “world-class” cities of the Dubai and Abu Dhabi, the international airport hubs and the fact the UAE had an unmanned spacecraft orbiting Mars as a signal of its emergence as a power.

“The UAE is a smart, sophisticated country which is doing great things and it is exactly the sort of people that the UK wants to be in business with,” he said. “We also have supportive military interests in countries such as Oman, UAE and Bahrain, so we recognise the strategic importance of the Gulf states.”

While Britain seeks to retain those strong military links with Saudi Arabia, the UAE and Qatar along with the naval bases in Bahrain and Oman, the government’s vision is to enter new areas.

It wants to expand education links with the region where British universities overseas have grown and where many children already study for UK A-Levels and GCSEs.

Britain sees the GCC as a partner, recognising the Gulf’s strengths and expertise, and with the UK able to offer advantages in services, education, science and technology.

“It's quite clear that Britain recognises that it is not to be confined within the boundaries of Europe, but as it traditionally always been, is going to be shaped by geography, particularly with regard to the sea routes which are tremendously important,” said Mr Jones.

“And that of itself is important in the UAE context, because Dubai World is a major port operator in the UK.”

The Foreign Office, which called GCC “one of the world’s most important networks for key regional and security issues” said that Yemen, the Afghan crisis and Iran’s “destabilising regional activity” were also discussed.