Category: Trade

The statement made by Anne-Marie Trevelyan, the then Secretary of State for International Trade, in the House of Commons on 6 September 2022.

Since the House adjourned for the summer recess, the Department for International Trade has made good progress on a number of areas. This statement provides Parliament with an update on progress with Ukraine reconstruction, the UK’s trade negotiations with India, negotiations towards accession to the comprehensive and progressive agreement for trans-Pacific partnership, and the developing countries trading scheme.

Ukraine reconstruction

At the end of July, following a competitive procurement process, we appointed Mott MacDonald and Crown Agents on a 12-week programme to act as Ukraine reconstruction industry advisors to the joint UK-Ukraine Infrastructure Taskforce. They will provide technical and logistical assessments, work with our counterparts in country to identify and prioritise current and future reconstruction projects, and provide technical support to the joint taskforce. At this stage the joint taskforce will focus on the Ukrainian Government’s immediate priorities—rapid replacement of essential housing and bridging infrastructure damaged by the conflict. Successful delivery of these projects is likely to support the Ukrainian economy and unlock new, larger mutually beneficial opportunities for UK businesses and Ukraine in later stages as we continue to support its post-conflict recovery and reconstruction. To ensure we can deliver the most effective reconstruction solutions through the infrastructure taskforce, we will work in close partnership with our brilliant UK businesses to unleash their full potential. UK Export Finance remains open for business in Ukraine with £3.5 billion of financial capacity available for UK exporters and Ukrainian buyers, subject to Treasury approvals.

Comprehensive and progressive agreement for trans-Pacific partnership

The first in-person accession working group following the United Kingdom’s application to join the comprehensive and progressive trans-Pacific partnership took place in Tokyo, 24 to 28 July 2022.

The UK team negotiated market access with CPTPP parties in the following areas: goods, services and investment, Government procurement, financial services and temporary entry.

Negotiations will continue over the course of the autumn with planning currently underway for the next round of talks. The Government will ensure that membership of CPTPP is achieved on terms that work for UK businesses and consumers.

Joining CPTPP offers numerous benefits to the UK. It will provide greater market access for British goods and services to one of the world’s largest free trading areas, with a combined GDP of £9 trillion in 2021. Reductions in tariffs and investment barriers will give UK firms increased opportunities to a growing market.

Beyond the immediate economic opportunities there is a significant geostrategic case for joining CPTPP. Membership will demonstrate that the UK is a global leader in free and rules-based trade. It will further establish the UK’s commitment to deeper engagement within the Indo-Pacific region in support of increased security and prosperity.

CPTPP will help the whole of the UK capture the benefits of global trade opportunities, by supporting jobs, wage growth and the levelling-up agenda. The Department’s preliminary analysis from the CPTPP scoping assessment suggests that every nation and region of the UK could be set to benefit from CPTPP membership.

The Government will keep Parliament updated as these negotiations progress.

UK-India trade negotiations

The fifth round of UK-India free trade agreement negotiations took place between 18 and 29 July 2022. The negotiations, at official level, were conducted in a hybrid fashion, with some negotiators in a dedicated Indian negotiations facility, and others attending virtually.

Technical discussions were held across 15 policy areas over 85 separate sessions, with detailed draft treaty text discussions.

In addition, intense negotiations have continued throughout the summer, again in a hybrid fashion, with India hosting UK negotiators and the UK also hosting Indian officials.

We are continuing to work towards the target, as set out by both Governments on 22 April 2022, to conclude the majority of talks by the end of October.

The Government will keep Parliament updated as these negotiations progress.

Developing countries trading scheme

On 16 August 2022 we launched the developing countries trading scheme. The scheme is a major milestone in growing free and fair trade with 65 developing nations that are home to more than 3.3 billion people. It is one of the most generous trade preferences schemes in the world and has been designed to boost trade with developing countries, helping them to grow and prosper. It delivers on commitments in the integrated review and international development strategy to harness the power of trade to support long-lasting development and it benefits the UK through reduced import costs, greater choice and improved economic security.

The developing countries trading scheme demonstrates that, as an independent trading nation, the UK can go beyond what we were able to do as a member of the EU. It introduces more generous, less bureaucratic trading rules that reduce tariffs, simplify rules of origin and simplify the requirements to access better tariff rates. It has been designed to boost jobs, drive growth and make supply chains more resilient.

Developing countries in the scheme collectively export over £20 billion of goods to the UK each year, such as t-shirts from Bangladesh, flowers from Ethiopia and bicycles from Cambodia. The developing countries trading scheme reduces import tariffs on these products and thousands more, saving businesses and consumers in the UK over £750 million per year and helping to tackle the cost of living.

The developing countries trading scheme proposals have been shaped by a public consultation held between July and September 2021. Responses were received from a broad range of stakeholders, including businesses and non-governmental organisations and overall supported a simpler, more generous developing countries trading scheme. A summary of consultation responses has also been published:

https://www.gov.uk/government/consultations/designing-the-uk-trade-preferences-scheme-for-developing-nations.

Key aspects of the developing countries trading scheme include:

Least developed countries continue to get tariff-free trade on everything but arms and ammunition and now benefit from more generous and simplified rules of origin, making it easier for them to participate in regional and global supply chains serving the UK.

Low income and lower-middle income countries benefit from more tariff reductions and removals. Nuisance tariffs and some seasonal tariffs have been removed.

Goods from India and Indonesia that are competitive in the UK domestic market are excluded from the scheme.

Eight countries immediately benefit from more generous tariffs as access to these tariffs is now based purely on economic vulnerability and not on the ratification of international conventions.

Powers to suspend countries from the scheme have been expanded. For the first time, climate change and environment related obligations are included in the grounds for suspension as well as those relating to human rights and labour rights.

For more detail on the new scheme and how it differs from the UK generalised scheme of preferences which it replaces, please see the comprehensive Government policy response:

https://www.gov.uk/government/publications/developing-countries-trading-scheme-dcts-new-policy-report.

The developing countries trading scheme will come into force in early 2023, giving businesses time to prepare for greater UK market access.

The statement made by Anne-Marie Trevelyan, the then Secretary of State for International Trade, in the House of Commons on 5 September 2022.

On 24 August, the Government launched negotiations with Ukraine towards a bilateral digital trade agreement, the proposed UK-Ukraine digital trade agreement.

The UK is standing shoulder to shoulder with Ukraine in the face of unjustified aggression from Putin, and I remain committed to ensuring that trade policy plays its part in supporting Ukraine now and throughout its economic reconstruction. In addition to the immediate actions we have already taken to liberalise tariffs and starve Putin’s war machine of funds, we need to put in place longer-term measures to support Ukraine and play our part in securing its future as a prosperous, stable and democratic partner in Europe.

The UK is increasingly recognised as a global leader in digital trade, with a network of international agreements that drive productivity, jobs and growth. In 2021, under its G7 presidency, the UK brokered agreement on the ground-breaking G7 digital trade principles, while earlier this year the UK-Singapore digital economy agreement—the world’s most innovative trade agreement—entered into force.

As a result, in my discussions with our Ukrainian partners, we have agreed that we should seek to negotiate a digital trade agreement to play an important role in supporting Ukraine’s reconstruction objectives. Ukraine has strong digital ambitions, and it has identified greater digitalisation of the economy as one of its areas of focus.

Ukraine sees digital trade as part of its vision for the future, and the UK is ideally placed to help Ukraine benefit from the opportunities this presents.

In addition to furthering our vital support for Ukraine, this agreement will also be good for British businesses. The current UK-Ukraine free trade agreement contains limited digital and e-commerce provisions. Expanding these commitments will remove barriers to digital trade and enable UK exporters to service Ukrainian markets more easily.

As digital trade is now the foundation of modern global trade, securing this agreement will send a strong signal of the United Kingdom’s support for our Ukrainian allies in response to the ongoing conflict, and further cement our position as a forward-thinking trading partner in the modern global economy.

I will continue to keep the House updated as negotiations develop.

The statement made by Anne-Marie Trevelyan, the Secretary of State for International Trade, in the House of Commons on 20 July 2022.

On Wednesday 20 July 2022, the Department for International Trade launched negotiations for a new, upgraded free trade agreement with Israel.

In line with our commitments to scrutiny and transparency, the Department for International Trade has published, and placed in the Libraries of both Houses, more information on these negotiations. This includes:

The United Kingdom’s strategic case for a UK-Israel free trade agreement (FTA)

Our objectives for the negotiations

A summary of the United Kingdom’s public consultation on trade with Israel

A scoping assessment, providing a preliminary economic assessment of the impact of the agreement.

The United Kingdom’s negotiating objectives for the upgraded agreement, published today, were informed by our call for input, which requested views from consumers, businesses, and other interested stakeholders across the United Kingdom on their priorities for enhancing our existing trading relationship with Israel.

These negotiations follow our signing of the UK-Israel trade and partnership agreement on 18 February 2019.

A new and enhanced trade agreement with Israel is a key part of the United Kingdom’s strategy to secure advanced modern agreements with new international partners, and upgrade existing continuity agreements in order to better suit the UK economy.

Israel is an important trading partner for the United Kingdom, with trade worth £5 billion in 2021 despite the disruptions of the coronavirus pandemic to global trade. As two of the most innovative and dynamic economies in the world—both in the top 15 of the global innovation index—we know that the opportunities of the future will come from sectors in which we both excel, such as technology, research and development, digital and data.

Our existing agreement, which forms the basis of our current trading relationship, is outdated and not designed for a digital age. Originally signed in 1995 between Israel and the EU, it was developed before smartphones, artificial intelligence and the internet transformed our economies. While it allows tariff-free trade on 99% of UK goods exports by value, it currently contains scant provision for the United Kingdom’s thriving services sector. We intend to change this by putting services at the heart of a modern new agreement, which better benefits the UK economy. Upgrading our trade deal with Israel will help unlock a stronger, more advanced partnership. A new agreement could make it cheaper and easier for innovative UK services and tech companies to trade with Israel, benefiting sectors including finance, accountancy and legal. The new deal will play to our strengths, reflecting the realities of trading in the 21st century and allowing us to take advantage of future innovations.

Around 6,600 businesses from all four corners of the United Kingdom exported their goods to Israel in 2020. Of these firms, 5,600 were small and medium-sized enterprises (SMEs). The United Kingdom’s SMEs could be amongst the biggest winners from a new agreement with Israel, as we seek to make it easier to do business and focus on trade barriers that may have deterred them from previously entering this exciting marketplace.

The Government are determined that any agreement must work for consumers, producers, investors, and businesses alike. We remain committed to upholding our high environmental, labour, public health, food safety and animal welfare standards, alongside protecting the national health service.

The Government will continue to update and engage with key stakeholders, including Parliament and the devolved Administrations, throughout our negotiations with Israel.

The statement made by Anne-Marie Trevelyan, the Secretary of State for International Trade, in the House of Commons on 19 July 2022.

The second round of UK-Canada Free Trade Agreement negotiations began on 20 June and concluded on 24 June. Owing to concurrent negotiations with India and CPTPP, a limited number of sessions will be held outside of this week, including goods market access, scheduled for mid-July.

The negotiations were hosted by Canada and conducted in a hybrid fashion; 40 UK officials travelled to Ottawa for in-person discussions and a further 145 attended virtually from the United Kingdom. Technical discussions were held across 34 policy areas over 52 separate sessions.

During this round, the UK set out its policy positions, having tabled text for the majority of chapters. Discussions were constructive, reflecting a determination from both sides to make progress, although we are only in the early stages of negotiations.

The negotiations continue to reflect our shared ambition to secure a progressive deal which looks to build on the UK-Canada Trade Continuity Agreement, and strengthens our existing trading relationship, already worth over £21 billion in 2021.

The third round of negotiations is due to take place in September 2022.

We remain clear that any deal the Government strike must be in the best interests of the British people and the economy.

The Government will keep Parliament updated as these negotiations progress.