UK looks to Gulf nations for post-Brexit trade pact

Britain ‘looking forward’ to agreement with GCC, minister says at Dubai forum

Britain has approached the UAE and other Gulf countries on a possible trade pact after Britain leaves the EU, the UAE economy minister said on Monday.

Such agreements can take years to negotiate, Sultan bin Saeed Al-Mansouri said on a panel at the World Government Summit in Dubai. He gave no further details.

Britain is due to leave the EU on March 29, but has yet to find an agreement acceptable to both Brussels and UK lawmakers, raising the prospect of a disorderly exit that could damage the world’s fifth-largest economy.

The UK was “looking forward” to a free-trade agreement with the Gulf Cooperation Council, Liam Fox, the UK state secretary for international trade, said during a visit to Dubai for the summit, according to state news agency WAM.

The GCC comprises the UAE, Qatar, Saudi Arabia, Oman, Kuwait and Bahrain.

In 2017, trade between the UAE and UK totalled £17.5 billion ($22.7 billion), up 12.3 percent from 2016, according to official figures.

By 2020, the UK government wants that number to increase to about £25 billion.

Britain’s economy slowed sharply in late 2018, pushing full-year growth to its weakest in six years as Brexit worries hammered investment by companies and the global economic slowdown weighed on trade, official data showed on Monday.

The pace of economic growth fell to a quarterly rate of 0.2 percent between October and December from 0.6 percent in the previous quarter, in line with forecasts in a Reuters poll, while output in December alone dropped by the most since 2016.

“The UK economy lost its summer exuberance in the final months of 2018, and there are signs of further chill winds ahead,” economist Tej Parikh at the Institute of Directors said.

Sterling fell by a third of a cent to below $1.29. For 2018 as a whole, growth dropped to its lowest since 2012 at 1.4 percent, down from 1.8 percent in 2017. Exports suffered from global weakness and consumers and businesses grew increasingly concerned about the lack of a plan for when Britain is due to leave the EU on March 29.

Prime Minister Theresa May has so far failed to win parliament’s backing for the plan she agreed with Brussels to avoid reimposing checks on goods exported from Britain.

Last week the Bank of England chopped its forecast for growth this year by 0.5 percentage points to 1.2 percent, which would be the weakest year since the 2009 recession. Monday’s data showed net trade lopped more than 0.1 percentage points from the fourth-quarter growth rate.