A trade deal between the UK and the Gulf states could be announced within weeks, The Mail on Sunday understands.
Negotiators in the Middle East thrashing out the agreement are said to be making a ‘final push’ ahead of a big gathering of the region’s leaders next month.
A source close to the discussions told this newspaper that the talks, which have been going on for more than three years, were now ‘past the point where there would be any major deal-breakers’ that could derail them at the last moment.
The UK began trade deal discussions with the Gulf Cooperation Council (GCC), which represents Saudi Arabia, Qatar, Bahrain, Kuwait, Oman and the United Arab Emirates, in June 2022 under the Conservative government. Labour has sought to accelerate trade ties with the region, despite concerns about doing business with nations such as Saudi Arabia, which is often criticised for human rights abuses.
Last month, Rachel Reeves unveiled £6.4 billion of deals with the kingdom on a visit to the Future Investment Initiative summit, nicknamed ‘Davos in the Desert’.
The Chancellor added that she was ‘really confident’ of getting a trade deal with the GCC ‘over the line’.
Pearl of the Gulf: Bahrain will host a crucial summit next month in a bid to seal the deal
Her comments followed those from Qatar’s finance minister Ali al-Kuwari, who told the summit that a trade deal between the GCC and Britain was ‘almost done’.
And, on a recent visit to Kuwait, Trade Minister Chris Bryant said the agreement was ‘very close’ with only ‘tiny things’ needing to be resolved.
It is understood that senior negotiators in the Gulf are trying to finalise the agreement before GCC leaders gather in Bahrain for their key summit next month. Collectively, the Gulf states already account for £60 billion of UK trade a year. It is hoped a free trade deal could raise this by 16 per cent.
A deal is expected to provide a boost for Britain’s pharmaceutical and auto industries as well as financial services, legal and education sectors.
It marks another step in the Labour Government’s efforts to boost ties with the region as Prime Minister Keir Starmer tries to revive economic growth.
The Chancellor is hoping the deal could be struck before her Budget on November 26, with the boost from trade deals offsetting the need for painful tax rises.
A trade deal would follow a flood of investment into the UK from various Gulf state investment funds. In December last year, Saudi Arabia’s Public Investment Fund snapped up a 15 per cent stake in Heathrow airport. The fund also owns most of Newcastle United Football Club.
Meanwhile, Qatar’s investment fund is a major player in the UK, with its portfolio including upmarket department store Harrods, as well as stakes in supermarket chain Sainsbury’s and water group Severn Trent.
Bahrain’s own sovereign wealth fund, the Mumtalakat, controls supercar maker McLaren, while the United Arab Emirate’s Mubadala investment firm, controlled by the Abu Dhabi government, owns fibre broadband challenger CityFibre.
A UK Government spokesman said: ‘Negotiations on a trade deal with the GCC are ongoing and remain a priority for this Government. Our focus is on getting the right deal that boosts growth and delivers real value to British businesses as part of our Plan for Change.’
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