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UK-GCC trade in numbers: relationship set for new era

By Andy Sambidge
UK trade secretary Anne-Marie Trevelyan launched free trade negotiations with the GCC in June Twitter
UK trade secretary Anne-Marie Trevelyan launched free trade negotiations with the GCC in June
  • Scroll down for country-by-country data
  • Trade with UK was £35.5bn over last 12 months
  • GCC is UK’s 7th largest export market 
  • FTA could boost trade by 16%

Total trade between all six GCC countries and the United Kingdom increased in the year to the end of the first quarter of 2022, as talks begin on a free trade agreement aimed at further boosting the relationship.

The UK posted a trade surplus with all the nations apart from Qatar, with the data showing the Gulf country exported £2.7 billion worth of gas as the Russian invasion of Ukraine started to impact global energy supplies.

According to an AGBI analysis of statistics in new documents released this month by the UK’s Department of International Trade (DIT), trade between the UK and the GCC countries totalled nearly £35.5 billion for the period under review, representing the UK’s seventh largest export market.

The UAE was the biggest trade partner in the region, making up one percent of the UK’s global trade.

According to 2020 figures, the latest available, around 12,400 UK VAT-registered businesses exported goods to the UAE while 3,100 such companies imported goods from the Gulf country. 

UK trade secretary Anne-Marie Trevelyan launched free trade negotiations with the GCC in June.

Government analysis shows that a free trade deal with the GCC is expected to increase trade by at least 16 percent, add at least £1.6 billion a year to the UK economy and contribute an additional £600 million or more to UK workers’ annual wages. 

Around 10,700 small and medium-sized businesses from every UK nation exported goods to the GCC in 2020, with SMEs accounting for more than 85 percent of total UK goods exports to Qatar, Saudi Arabia and the UAE.

James Caldecourt, head of international trade, Deloitte, expects a free trade agreement (FTA) to boost UK-GCC trade figures.

“With over 56 percent of the UK’s services exports to GCC states digitally delivered, an ambitious digital chapter could help to create opportunities for priority sectors while improving efficiency in the bilateral trade corridor,” Caldecourt said.

“We also anticipate an FTA helping to facilitate stronger exports in manufacturing, particularly in the automotive and machinery sectors. 

“There is a significant opportunity for the UK green energy sector to deepen its presence in GCC states as they transition from oil towards renewable sources. For instance, by lowering or removing tariffs of up to 15 percent currently applied to wind turbine parts.

“A comprehensive FTA will also include provisions in a wide range of other areas, including intellectual property, innovation, competition, agriculture, sustainability and labour standards,” he added.

Freddie Neve, senior Middle East associate at Asia House, a London-based think tank, said: “The UK has a large trade surplus with the GCC and faces more barriers to trade with the GCC than the GCC does in its trade with the UK. 

“This gives the UK a greater incentive and room to manoeuvre in terms of improving market access.

“GCC states may therefore seek concessions beyond the confines of removing barriers to trade in return for granting the UK greater market access. The GCC may seek foreign investment from the UK to support economic diversification, or commitments relating to defence, security, and foreign policy.”

But negotiations may not be straightforward. While the GCC has successfully signed FTAs with Singapore and the European Free Trade Association – consisting of Iceland, Liechtenstein, Norway and Switzerland – attempts to negotiate deals with other countries and trade groups have largely stalled. 

GCC negotiations with China have been ongoing since 2004 while discussions with the EU faltered in 2010. Similar negotiations with New Zealand, Turkey and India have also stalled.

“The GCC’s past difficulties negotiating free trade agreements is another clear obstacle to navigate,” Neve added.

“It is plausible that individual members could try to push the UK government to depart from its stated position of negotiating an FTA with the GCC as a bloc, particularly if negotiations begin to falter.”

  • Below is a summary of the UK’s trade with each of the GCC countries, along with the most traded products, according to the DIT’s figures. The review periods compared are the 12 months up to March 2022 and the 12 months to April 2021.

UK-Bahrain

Bahrain was the UK's 85th largest trading partner with total trade increasing by 26.1 percent (or £184 million) to £889 million in the 12 months to March 2022 compared to the four quarters to the end of Q1 2021
Bahrain was the UK’s 85th largest trading partner with total trade increasing by 26.1 percent (or £184 million) to £889 million in the 12 months to March 2022 compared to the four quarters to the end of Q1 2021

Total trade 2022£889mTotal trade 2021£705m
Total UK exports to Bahrain 2022£713mTotal exports 2021£515m
Total UK imports from Bahrain 2022£176mTotal imports 2021£190m
UK trade surplus 2022£537mUK trade surplus 2021£325m
Top 5 UK exportsTop 5 UK imports
Jewellery£82.5mRefined oil£53.6m
Cars£28.3mMechanical power generators£6.7m
Miscellaneous electrical goods£18.7mElectric motors£6.1m
General industrial machinery£9.7mCars£5.4m
Scientific instruments£8.5mIron & steel£5m

UK-Kuwait

Kuwait was the UK's 57th largest trading partner with total trade increasing by 5.5 percent (or £127 million) to £2.4 billion in the 12 months to March 2022 compared to the four quarters to the end of Q1 2021
Kuwait was the UK’s 57th largest trading partner with total trade increasing by 5.5 percent (or £127 million) to £2.4 billion in the 12 months to March 2022 compared to the four quarters to the end of Q1 2021
Total trade 2022£2.4bnTotal trade 2021£2.3bn
Total UK exports to Kuwait 2022£1.6bnTotal exports 2021£1.89bn
Total UK imports from Kuwait 2022£833mTotal imports 2021£416m
UK trade surplus 2022£769mUK trade surplus 2021£1.5bn
Top 5 UK exportsTop 5 UK imports
Metal ores & scrap£67.5mRefined oil£757.6m
Cars£65.7mPlastics£16.6m
Medicinal & pharmaceutical products£34.2mWorks of art£3.4m
Clothing£26.8mPhotographic & optical goods, clocks£3.1m
General industrial machinery£20.2mMiscellaneous electrical goods£2.1m

UK-Oman

Dome, Architecture, BuildingUnspash
Oman was the UK’s 78th largest trading partner with total trade increasing by 13.9 percent (or £131 million) to £1.1 billion in the 12 months to March 2022 compared to the four quarters to the end of Q1 2021
Total trade 2022£1.1bnTotal trade 2021£969m
Total UK exports to Oman 2022£862mTotal exports 2021£754m
Total UK imports from Oman 2022£211mTotal imports 2021£188m
UK trade surplus 2022£651mUK trade surplus 2021£566m
Top 5 UK exportsTop 5 UK imports
Mechanical power generators£71.5mAircraft£39.1m
Aircraft£45.7mMechanical power generators£18m
General industrial machinery£28.9mScientific instruments£10.3m
Cars£27.8mWorks of art£9.7m
Medicinal & pharmaceutical products£23.9mRoad vehicles other than cars£9.5m

UK-Qatar

Qatar was the UK's 34th largest trading partner with total trade increasing by 30.5 percent (or £1.5 billion) to £6.2 billion in the 12 months to March 2022 compared to the four quarters to the end of Q1 2021
Qatar was the UK’s 34th largest trading partner with total trade increasing by 30.5 percent (or £1.5 billion) to £6.2 billion in the 12 months to March 2022 compared to the four quarters to the end of Q1 2021
Total trade 2022£6.2bnTotal trade 2021£4.7bn
Total UK exports to Qatar 2022£2.7bnTotal exports 2021£3.4bn
Total UK imports from Qatar 2022£3.5bnTotal imports 2021£1.4bn
UK trade defecit 2022£816m UK trade defecit 2021£1.9bn
Top 5 UK exportsTop 5 UK imports
Mechanical power generators£623.1mGas£2.7bn
Cars£100mMechanical power generators£414.3m
Aircraft£90.9mRefined oil£83.7m
Scientific instruments£86.1mScientific instruments£46.9m
Miscellaneous electrical goods£59.6mMiscellaneous metal manufactures£20m

UK-Saudi Arabia

Saudi Arabia was the UK's 27th largest trading partner with total trade increasing by 6.4 percent (or £683 million) to £11.3 billion in the 12 months to March 2022 compared to the four quarters to the end of Q1 2021
Saudi Arabia was the UK’s 27th largest trading partner with total trade increasing by 6.4 percent (or £683 million) to £11.3 billion in the 12 months to March 2022 compared to the four quarters to the end of Q1 2021
Total trade 2022£11.3bn Total trade 2021£10.62bn
Total UK exports to Saudi 2022£8.9bnTotal exports 2021£8.44bn
Total UK imports from Saudi 2022£2.4bnTotal imports 2021£2.18bn
UK trade surplus 2022£6.6bn UK trade surplus 2021£6.3bn
Top 5 UK exportsTop 5 UK imports
Mechanical power generators£411mRefined oil£702.9m
Jewellery£254.3mMechanical power generators£374m
Medicinal & pharmaceutical products£237.9mShips£209.9m
Scientific instruments£167.8mPlastics£100m
Miscellaneous metal manufactures£158.8mCrude oil£50.7m

UK-UAE

High Rise, Building, City
The UAE was the UK’s 24th largest trading partner with total trade increasing by 21 percent (or £2.4 billion) to £13.6 billion in the 12 months to March 2022 compared to the four quarters to the end of Q1 2021
Total trade 2022£13.6bn Total trade 2021£11.2bn
Total UK exports to UAE 2022£8.3bnTotal exports 2021£7.56bn
Total UK imports from UAE 2022£5.3bnTotal imports 2021£3.7bn
UK trade surplus 2022£3bn UK trade surplus 2021£3.8bn
Top 5 UK exportsTop 5 UK imports
Mechanical power generators£651.1mRefined oil£1.2bn
Jewellery£333.4mMechanical power generators£416.4m
Unspecified goods£291.4mJewellery£238.8m
Cars£282.6mTelecoms & sound equipment£194.7m
Telecoms & sound equipment£259mMiscellaneous metal manufactures£163.4m

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