DIT: ‘UK-Gcc fta: the UK’s Strategic Approach’ 2022.
enquiries@trade.gov.uk
uk interests in middle east [despite their appalling human rights record]
1/-a piece of saudia arabia’s 1 trillion pounds investment program [ to diversify away from oil…..just to build another silly city in the desert]
2/-to attract investiment from gcc to the uk….
3/-saudis to back uk so that gcc agrees the uk proposed FTA: A proposed uk/gcc FTA (FREE TRADE AGREEMENT) will be a significant moment in the UK-GCC relationship. a deal with the GCC is expected to increase trade by at least 16%. The fifth round of negotiations is expected to be hosted by the GCC later this year
The Gulf Cooperation Council (GCC) is a trading bloc of six countries including Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates (*uae)….*uae is a money laundering hub
Recently, there have been tectonic shifts in antitrust activity throughout the Middle East & North Africa (MENA) region.
cmas have been set up in : the Kingdom of Saudi Arabia (KSA), Jordan and Kuwait , among others. and the set up of the “Arab Competition Network”
GCC UK STRATEGY.
UK-GCC FTA
The UK’s Strategic Approach
The government has been clear that an FTA with the GCC must work for the UK and beneft UK consumers, producers, businesses and (NHS). The government remains committed to upholding our HUMAN rights,high environmental, labour, food safety and animal welfare standards in our trade agreement with the GCC.
A trade agreement with the GCC could make trade easier and cheaper for UK exporters, whilst improving choice and value for UK consumers.
Removal of GCC tariffs on imports in a potential FTA could result in savings for UK companies and increase the competitiveness of UK products. The removal of tariffs and greater regulatory transparency provided by an FTA could support
GCC Vision Plans to diversify their economies away from oil and gas, to encourage trade in cutting-edge technologies and modernising our approach to emerging industries, we
could foster conditions for innovation. + Supporting jobs for UK workers
The region with the most workers supported by GCC
investment was in London (12,000 people), followed by the South East (4,000 people) and the North West (2,000 people).
respondents called for the agreement to enhance competition laws and rules.
it is diffcult for UK businesses to compete with GCC state enterprises
receiving state support or openly exempt from clcp
The government is committed to upholding the UK’s advanced, independent competition regime in its ftas
The government will seek to promote open and fair competition
ensuring that UK businesses operating in GCC member states can compete fairly with state enterprises. The UK and GCC member states are signatories to the WTO Agreement on Subsidies and Countervailing Measures.
The government will seek to secure more extensive market access to government procurement in the GCC member states, creating opportunities for UK businesses
House of Commons
International Trade Committee. FTA [Free Trade Agreement] Negotiations with GCC 2022–23
the Clerk of the International
Trade Committee, House of Commons, London SW1A 0AA.020 7219 6957
tradecom@parliament.uk
In June 2020 the Department for International Trade (DIT) began a review into
market access opportunities with the Gulf Cooperation Council (GCC), a political and
economic alliance of six Gulf states.
the UK government is currently undertaking negotiations to agree a Free Trade Agreement (FTA) with the GCC.
any agreement must contain binding commitments to protect people and the environment, and not compromise UK values and obligations. < > GCC clcp ban anti-competitive practices as in Western systems. The main divergences:
a/pro-competitive rules do not apply to governmental acts or acts of entities controlled by the State, and
b/weak cl enforcement, which exist only on paper but lacks of effective deterrent effects
The Gulf Cooperation Council (GCC) is a political and economic alliance comprised
of six countries: The United Arab Emirates (UAE), The State of Bahrain, The Kingdom of
Saudi Arabia, The Sultanate of Oman, The State of Qatar, and The State of Kuwait.
merits of pursuing bilateral agreements with the individual GCC states, rather than with the GCC bloc….why? : bilateral agreements would allow us to push individual states further to be more ambitious with, for example, human rights and environment provisions, rather than settling for a lowest common shared standard…eg from an environmental perspective “the clock is ticking”, so it could be beneficial to reach agreements with some states bilaterally to encourage them to decarbonise more rapidly
Dr Roberts told us that “the UK might be able to forge a broad and shallow FTA with the GCC and use that as a basis for deeper bilateral engagement”…. but Tom Wills of the Business & Human Rights Resource Centre, emphasised that “a low standards agreement with the GCC would not reflect the settled view of the UK public and uk Government on
human rights and the problem of greenhouse gas emissions. when it comes to trade with Saudi Arabia and the UAE, “human rights and equality were the top priorities of the UK public”
Trade deals are like the motorway. It’s fantastic, you get them built, but if cars aren’t going back and forth, then you might as well not have built them. The going back and forth are exports and investments
We recommend that the Government produce, as a matter of urgency, a trade
strategy to negotiations and decision-making on FTAs, to reflect the views of the public, trade unions and the devolved administrations. We, therefore, recommend that the Government strengthens engagement with trade unions, and devolved administrations,[ and wpi ngos?] during the negotiating process as we need to demonstrate best practice on the rights of workers in other countries
animal welfare
UK already exports “a huge amount of [halal] meat
to the UAE, Kuwait, Qatar and Saudi Arabia” and by providing greater assurance to
consumers, including through the Demonstration of Life protocol, the UK could see an
increase in exports to the region.
need for the UK to invest in (R&D) on animal stunning methods, to ensure we can meet import
requirements for halal meat in the GCC.
‘Compassion in World Farming’, stated that this FTA “must not facilitate the live
export of breeding animals to the Gulf, due to their appalling slaughter conditions” with
the risk that such exports would undermine British farming standards and the provisions
of the Animal Welfare (Kept Animals) Bill that Government is currently taking through
Parliament.
Human rights
Human Rights Watch, told us of serious humanrights abuses occurring across the GCC states. Some of the most pressing concerns include the continued repression of women, the repression of the rights of LGBTQ+ individuals, and a crackdown on activists and the civic space.
significant concerns about freedom of expression and freedom of conscience, criminalisation of LGBTQ rights and “repressive crackdowns
UK negotiators should root out the tariff and non-tariff barriers that discriminate against
women
The Trade Justice Movement also noted that a UK-GCC FTA could disproportionately impact women, if provisions, such as those on ip, increase the cost of medication, as women have less ability to pay for goods. Women may also be further impacted as small business owners and consumers, if there is further retail liberalisation through this FTA
a UK-GCC FTA could damage the rights of LGBTQ+ communities, if references to their rights are omitted
the UK Government should utilise its political leverage to take a stand on human rights,
including LGBTQ+ rights, ahead of an FTA being signed, rather than retrospectively…and there should be ongoing monitoring of the regional impact of an FTA on humanrights
Government should evaluate, and publish, the likely impact of this FTA on the human rights situation in the GCC member states. This must include specific assessments of the likely impact on both women and LGBTQ+ individuals, in order to anticipate and mitigate negative impacts during the negotiations process.
Trade Justice Movement told us that within FTAs, wpis = tsd [eg: gender, labour and environmental issues] have a limited focus and lack enforceability…the UK should take a “more holistic approach” to human rights so that ftas complement human rights
Human Rights Watch: UK Government “is not unimplicated in some of the abuses” occurring in the GCC states, as a result of its selling and authorising weapons to the region
Gulf countries depend on migrant workers who on average make up about 70% of the
Gulf states’ workforce. The kafala system is a legal framework that has been used in all
GCC states. It operates as a sponsorship system that ties workers to a local sponsor who
is effectively their employer. Workers are not able to change their jobs without their
sponsor’s permission which puts power in the hands of the employer and often locks
workers in exploitative forms of employment. workers are often subject to abuses and “terrible” working conditions in the GCC have led to the deaths of “workers … from heat conditions in the construction of the stadium for the Qatar World Cup… as well as workers trapped in unsanitary conditions”
uk must deny entry of goods “that is suspected of containing forced labour inputs or of using labour that violates any of the labour laws
We support the implementation of the Trade Act 2021 and the Modern Slavery Act 2015, to ensure the UK is not complicit in rights abuses through its supply chains.
Environmental standards:
Friends of the Earth told us that all GCC members “follow fossil fuel-based economic models …. and low climate ambition”, and that “no GCC nation offers a viable model for climate adaption or mitigation”. the methods referenced in the gcc Vision Plans
are ‘cleaner’ forms of gas, and advancements in sustainable technology, carbon capture and tree planting, rather than a commitment to cut gross emissions”
witnesses informing us of a “disconnect” between the UK’s climate change objectives, and
the Government’s approach to trade, and that the ukgcc fta will not “help the UK
achieve its climate and international development objectives”
the FTA should include strong references to the 1.5°C Paris target, commitments to net-zero and non-regression provisions.
Taking the example of the UK-New Zealand FTA, we were informed that an agreement could proactively build in fossil fuel subsidy reform, or include progressive commitments on carbon pricing and electricity trading, as seen in the EU-UK Trade and Cooperation Agreement (TCA)
the Green Alliance think tank, advised that the environment fta chapter
should be subject to dispute resolution mechanism
A particular concern about a UK-GCC FTA is the risk of carbon leakage, which the Government also noted may emerge in the short and medium term “given the UK is likely to implement additional climate mitigation policies at a faster rate than the GCC member states…to mitigate these risks, we will require “strong commitments to net zero, decarbonisation and transition….Carbon border adjustment mechanisms (CBAM) is only a partial solution to mitigate carbon leakage.
investorstate dispute settlement (ISDS) mechanisms can be used to address disputes, like environmental standards. in other countries, ISDS provisions enabled companies to sue governments for policies which are harmful to their profits, and the risk [to environment] that ISDS could be used within this FTA by firms to challenge new climate change regulations.
Mr Witten stated that ISDS is a “significant risk from an environmental perspective”.184
ulike the ISDS, FTA state-to-state adr (alternative dispute resolution) would be much
more transparent….ISDS clauses are “incompatible with human rights and environmental
protections”
there should be termination of isds clauses in bilateral investment treaties between the UK and Bahrain, Oman and UAE, and similar treaties with Kuwait and Qatar which are not yet in force; and in the Energy Charter Treaty
the differing environmental standards and commitments both between the UK and GCC, and
across the individual GCC states, makes it challenging to implement higher environmental standards
The UK and the GCC has differing climate policies, creating a risk of carbon leakage between us. Will DIT use the Agreement to agree a carbon border adjustment mechanism?:
uk is preparing policy options to mitigate against carbon leakage risk. This will include
whether policies such as a carbon border adjustment mechanism (CBAM), mandatory
product standards as well as labelling and procurement measures could be a useful part
of the UK’s policy mix.
As in the recent UK-Australia and UK-New Zealand FTAs, will this agreement contain similar references to the Paris Agreement, net zero targets, and an environmental goods list of liberalised tariffs?:
All GCC countries are parties to the Paris Agreement, which aims to limit global
warming to under 1.5C. The UK has a track record of working with GCC countries on
clean energy and we seek to build on this through the FTA….As part of the FTA the UK will seek to reduce or remove tariffs across a range of goods, including those that help achieve net zero. For example, exports of UK wind turbine parts currently face tariffs of up to 15%. An agreement with the GCC would create opportunities for other parts of the UK’s green technology industries including solar power, hydrogen power, electric vehicles and smart energy systems.
Will the environment chapter provisions be binding and subject to dispute settlement mechanism?: uk gov is seeking to create a strong adr to comply with the fta