United Kingdom Trade Agreements – Updated
United Kingdom trade agreements – Departure from the European Union
The United Kingdom officially left the European Union on 31st January 2020 and the pre-agreed transition period came to an end on 31 December 2021. With the end of the transition period the United Kingdom became no longer a part of the customs union and single market. Although a comprehensive trade deal was struck at the 11th hour between the United Kingdom and European Union, goods between the two will now be subject to customs and other checks.
A combination of the Covid19 pandemic, general poor relations between the United Kingdom and European Union post Brexit and some confusion on what paperwork and procedures are required is now causing delays on the borders between the two parties.
United Kingdom trade agreements – General economy information
Main trade partners are United States, Germany, France, Netherlands, China, Republic of Ireland, Belgium and Switzerland.
The United Kingdom is a member of the WTO and GATT
Trade volumes for 2019 were;
Export of goods – 367 billion GBP
Import of goods- 542 billion GBP
Economy by sector:
Agriculture – 0.6%
Industry – 19.2%
Services – 80.2%
United Kingdom trade agreements – New deals to replace European Union trade agreements
Up until 31 December the United Kingdom was a part of the trade deals of the European Union but with the United Kingdom’s final departure from the block a whole new set of trade deals were required. The United Kingdom needed to negotiate new trade agreements with all the countries originally covered by European Union deals and these new deals needed to take effect from the 1 January 2021.
A full list of the trade deals which were completed and took effect by 1 January 2021 can be found on the UK government website link below. The article also includes updates on the current state of negotiations for those deals not yet completed or yet to be ratified:
https://www.gov.uk/guidance/uk-trade-agreements-with-non-eu-countries
The list is very impressive with 60 deals either done or under negotiation across the world.
One of the most successful of the UK’s new trade deals is the Free Trade Area Agreement with Ukraine. In the first 3 months of 2021 trade between the two countries rose by 33% year on year. Trade between the two countries was also well balanced with Ukraine exporting 221 million USD and importing 232 million USD equivalent from the UK. Whilst the numbers are still relatively small in comparative terms this is a trade deal with huge potential for both the UK and Ukraine.
The United Kingdom has now agreed its first post Brexit trade agreement negotiated completely from scratch. The deal is with Australia and was finalised in negotations between Boris Johnson and Australian Prime Minster Scott Morrsion. Boris Johnson said the deal represented a ‘new dawn in the UK’s relationship with Australia underpinned by our shared history and common values’.
The final deal is expected to be very comprehensive with the UK aiming to sell cars, whiskey and confectionery to Australia. One sticking point has been meat exports with UK farmers worried about new meat exports from Australia undercutting them on cost.
United Kingdom trade agreements – Some of the deals completed or under negotiation
Some very important deals are already in place and have been operating since 1 January. These include completed deals with main trading partners such:
Japan – fully ratified – 2019 trade between the two nations totaled 29,182 million GBP
Singapore – fully ratified – 2019 trade between the two nation totaled 17,028 million GBP
Switzerland – fully ratified – 2019 trade between the two nations totaled 37,147 million GBP
South Korea – fully ratified – 2019 trade between the two nations totaled 11,940 million GBP
The UK had begun negotiations on two new trade deals. Negotiations with India started on 17th January and this is significant as the UK does not currently have any trade deal with India at all. In March 2022 negotiations started on a completely new trade deal with Canada, the existing deal effectively replicates the deal the EU has with Canada and the new deal is hoped to be comprehensive.
Preparations are also being made to start work on new trade deals with the following countries; Mexico, Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, UAE and Israel. Current deals with these countries largely replicates the old EU deals.
United Kingdom trade agreements
United Kingdom trade agreements – New deals with great potential
The United Kingdom has also reached Mutual Recognition Agreements (MRA) with USA and New Zealand. Of course the United Kingdom places great importance on eventually reaching a comprehensive trade agreement with the United States, the current MRA covers areas such as electromagnetic compatibility, telecommunication equipment and good manufacturing practices. The advantage of these deals is that United Kingdom produced goods can be tested in the United Kingdom for their compliance with United States standards and vice versa.
A full trade deal between the United Kingdom and United States faces negotiations difficulties especially in the areas of agriculture and pharmaceuticals (Source: Congressional Research Service report), so any full trade deal could be some years away.
Great news – The free trade deal between United Kingdom and New Zealand as now been completed. The comprehensive new deal will completely end tariffs between the two countries, reduce red tape and help create jobs and economic growth in the UK.
More useful information on the United Kingdom economy and import and exports can be found in our United Kingdom Country Guide
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United Kingdom Trade Agreements – Latest
