GCC, UK sign FTA to boost trade exchange, investments

Snapshot of the agreement signing

The Gulf Cooperation Council (GCC) signed today, May21, a free trade agreement (FTA) with the UK, aimed at strengthening economic ties and scaling up bilateral trade exchange and investments.

The agreement will support Gulf non-oil exports, including petrochemicals, aluminum, fertilizers, and manufacturing industries, in addition to eliminating customs duties on more than 99% of Gulf exports, according to an official statement.

The council added that the agreement opens broader opportunities for SMEs to expand into the UK market and benefit from available trade and investment opportunities.

Moreover, GCC countries should leverage the agreement to enhance cooperation in financial services, technology, education, and clean energy, while benefiting from British expertise in these sectors. The agreement is also expected to expand partnerships in the digital economy, food security, and supply chains, create jobs, increase investments, and improve the efficiency of trade exchange between both sides.

The GCC nations are considered a major trading partner for the UK, with trade volume between the two sides reaching $31 billion in 2025. Direct GCC investments in the UK totaled approximately $83 billion over the past 10 years.

For its part, the UK government stated that the agreement is expected to boost the UK economy with around £3.7 billion annually in the long run. It will also eliminate customs duties estimated at around £580 million annually on British exports to GCC countries once fully implemented, including £360 million that will be removed immediately when the agreement is fully implemented.

The UK government added that the agreement includes tariff exemptions on several food, medical, and advanced industrial products, as well as facilitation measures related to data flow freedom and customs procedures. The agreement will reduce tariffs and ensure simple and efficient customs, with a clear commitment to clear goods within 48 hours (six hours for perishable goods), provided that all requirements are met.