LONDON: The U.K. government announced a historic trade agreement with six Gulf states, becoming the first Group of Seven nation to strike such a deal with the Gulf Cooperation Council.
The agreement could add an estimated £3.7 billion ($4.9 billion) annually to the U.K. economy and increase wages by £1.9 billion per year in the long term, the Department for Business and Trade said.
“The U.K. could see a boost to growth and higher wages for decades to come after becoming the first G7 country to secure a trade deal with the GCC today,” the department said in a statement, citing long-term job support and greater domestic resilience.
The GCC includes Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates. The British government said the deal reflected “solidarity and long-term cooperation with its Gulf partners.”
According to the department, the agreement will eliminate an estimated £580 million in annual duties based on current U.K. exports to the region once fully implemented, with £360 million of that amount removed on the first day the deal takes effect.
British exports expected to become tariff-free under the deal include cereals, cheddar cheese, chocolate and butter.
The pact marks the fifth major trade agreement under the current U.K. government, following deals with India, the United States, the European Union and South Korea.
The announcement offers a boost to Prime Minister Keir Starmer, who faces leadership challenges, and comes as the U.K. economy remains under pressure from the Iran war.
“Today’s agreement is a huge win for British business, and for working people who will feel the benefits in the years ahead through higher wages and more opportunities,” Starmer said.
“The Gulf states are valued economic partners and this agreement deepens that relationship, building trust and unlocking new possibilities for trade and investment,” he added.
