Visa exemption and free trade.. Britain is aggressively seeking to attract Gulf investments

LONDON

- The British government spares no effort to reach a free trade agreement with the Gulf Cooperation Council countries, and it appears that the tour - which brought together the British Minister of Foreign Trade and representatives of the GCC countries in Riyadh last June - brings the two sides closer to concluding this the agreement.

Since the United Kingdom left the European Union in 2016, it has been looking for new economic partners with special priority for the countries of this region, and this is due to several factors, including the volume of Gulf investments in Britain, the growth in demand in these markets, and the high purchasing power of its citizens, which makes them among the most tourists spending in the United Kingdom.

Saving foreign investment

The World Investment Report for the year 2021 showed that the volume of foreign investments flowing into the United Kingdom amounted to about 20 billion dollars in 2020, a decrease of 57% compared to the year 2019 which amounted to about 45 billion dollars, which are modest numbers compared to the year 2016, which witnessed a jump to more than 200 billion dollars. , before the downward curve began since the announcement of the results of the Brexit referendum.

Britain's attractiveness has fallen from 11th globally in the list of the most attractive countries for investment to 16th globally. This worrying situation for the UK's position makes it spare no effort in searching for large investors.

Here, the importance of the Gulf states appears. Qatar is the largest investor among the Gulf states in the United Kingdom, with about 35 billion pounds, in addition to an agreement between Doha and the United Kingdom on new Qatari investments amounting to 10 billion pounds during the next five years.

The UAE also announced investments worth 10 billion pounds in the coming years in the United Kingdom, in contrast, Saudi Arabia announced that it aims to reach a total of 64 billion dollars in investments and trade exchanges, at a time when the British government is engaged in negotiations with the Saudi Public Investment Fund to pump its money into a number of countries. British projects.

Tourism promotion

Tourists from the Gulf countries are the biggest spenders in the UK.

Returning to the year 2019, which is a reference for tourism activity before the global closure due to the Corona epidemic, we will find that in the first quarter of this year alone, more than 177,000 Gulf tourists arrived in Britain and spent about 382 million pounds.

The rate of Gulf tourists who arrive in Britain is estimated at 600,000-700,000 annually, spending more than one billion pounds on tourism.

Perhaps this is what prompted the United Kingdom to announce that all citizens of the Gulf countries will benefit from visa-free entry starting next year.

According to the British Home Office, citizens of the Gulf Cooperation Council countries will benefit from the electronic travel permit known as “ETA” starting from the year 2023, which is an electronic form that citizens of the Gulf countries will have to fill out two days before their arrival in the United Kingdom and they do not have to pay any fees, nor submit their passports or Get their fingerprints.

The electronic travel license falls within the context of the United Kingdom’s project to make traffic through its airports 100% electronic, and this means that starting next year, any Gulf citizen will only have to fill out the form on a website belonging to the Ministry of Interior and then travel to the United Kingdom, and even when he arrives at the Kingdom’s airports, he will not be subject to disclosure The visa, and it will pass through electronic portals, summarizing the waiting hours at airports.

Until this license is activated during the beginning of next year, citizens of Gulf countries can benefit from the electronic visa, which can also be obtained through the Ministry of the Interior's website, with a fee of 30 pounds.

The rate of Gulf tourists arriving in Britain is estimated at 600,000-700,000 annually (Reuters)

Reducing tariffs

The British government is seeking, in its negotiations with the Gulf Cooperation Council countries, to significantly reduce the customs tariff imposed on British food products, especially those that reach the Saudi, Emirati and Qatari markets.

According to the British Ministry of Foreign Trade, the volume of food exports to the Gulf countries amounted to about $767 million during the year 2021, and the ministry aims to significantly reduce customs tariffs on pastries and foodstuffs made of wheat, grains, salmon and chocolate.

According to British official documents, the average customs tariff imposed on GCC exports is 0.4%, and this is due to the non-application of any customs tariffs on oil and gas coming from the Gulf, which constitute the bulk of GCC exports to the United Kingdom.

In contrast, the average GCC tariff applied to UK exports is about 4.8%, which is a high percentage, and British negotiators will try to achieve a balance by seeking to exempt food and beverage products from customs tariffs to give them greater competitiveness in the Gulf markets.

Trade exchanges between the GCC countries and the United Kingdom increased between 2010 and 2019, reaching 41 billion pounds by the end of 2019.

During this period, British exports to the Gulf countries increased by 48% (26 billion pounds in 2019), while Gulf exports to the Kingdom increased by 54% (15 billion dollars).

Exchanges between the two parties witnessed a significant decline in 2020 due to the Corona epidemic and the global closure, as Gulf exports to the United Kingdom fell by 44%, while British exports fell by 16.3%.