UK concludes $5 billion trade deal with the Gulf

Britain announced on Wednesday that it had concluded a trade deal with the Gulf Cooperation Council (GCC), which it said would be worth $5 billion annually over the long term, strengthening economic ties with its allies in a region marked by the fallout from the war in Iran.

The deal with the GCC — made up of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates — comes months after U.S.-Israeli strikes against Iran in February, triggering retaliatory Iranian attacks across the region and disrupting global energy and food supplies.

"In a context marked by growing instability, today's announcement sends a clear signal of confidence — it gives British exporters the certainty they need to look to the future," British Trade Minister Peter Kyle said.

The British government said the deal would ultimately reach 3.7 billion pounds ($4.96 billion) a year in the long term, more than double the previous estimate of 1.6 billion pounds, as the final deal went further than expected in trade liberalization and service commitments.

Under the deal, 93% of GCC tariffs on British goods will be removed, equivalent to eliminating 580 million pounds in tariffs within 10 years. Two-thirds of those tariffs will disappear as soon as the deal takes effect.

The government said the automotive, aerospace, electronics, food and drink sectors would be among the main beneficiaries, with cereals, cheddar, chocolate and butter becoming tariff-free.

In return, Britain has also reduced its tariffs for GCC imports, although the Gulf countries' main exports to Britain — oil and gas — are already exempt from duties.

The agreement also includes commitments on services, allowing British companies to expand in GCC markets without facing new barriers, while Gulf states are expected to benefit from greater access to the U.K. services sector.

GCC Secretary-General Jassem Mohammad Albudaiwi said the deal included a framework designed to deliver "tangible and measurable" economic benefits for businesses, investors and citizens of the seven signatory countries. He added that the deal covered trade in goods and services, financial services, digital trade, investment protection, telecommunications and other areas.

According to the British government, the deal neither changes nor weakens the U.K.'s environmental or data protection standards, and contains no provisions on human rights. Some advocates had urged London not to sideline human rights concerns in any deal with the GCC.

Tom Wills, director of the Trade Justice Movement, said that by "failing to negotiate any binding protections for human rights as part of the deal, the United Kingdom has taken a step backward morally."

The deal also includes investor protection provisions for the three GCC states not previously covered by such treaties, as well as investor-state dispute settlement mechanism, a device that would allow Gulf investors to sue the British government — a measure criticized by Wills.