The UK’s withdrawal from the European Union (EU) after the Brexit referendum in June will open new opportunities for advancing the position of the Gulf Cooperation Council (GCC) as an economic powerhouse by increasing the bilateral trade between the UK and the GCC, according to a new report entitled “UK’s EU Referendum: Why ‘Brexit’ Matters to the GCC”.
According to the report, the UK’s trading relations with the Gulf countries, as well as other nations, are seen to become even more robust as the world’s fifth biggest economy increased its efforts to acquire more deals outside of the EU.
Consequently, the vote to leave the EU will have a positive effect, the report cited, adding that the United Arab Emirates (UAE) and Britain have set a new target last year for a bilateral trade agreement, doubling the current value to AED 135.24bn by 2020, after sealing the Double Taxation Agreement this year.
“The UAE, for example, is becoming more attractive among UK investors and the rest of the world, as the government aggressively pursues the country’s transformation into a regional and global hub of the 21st century,” said Nidal Abou Zaki, managing director at Orient Planet Research.
On the other hand, Brexit is expected to have an impact on Saudi Arabia’s economy as it is one of the UK’s biggest markets in the Middle East, with exports valued at €5.5bn in 2015, while Saudi investments in Britain were estimated at €62bn.
However, some economic experts have warned of economic risks for Saudi Arabia if the UK ever fell into recession, noting that this would affect its perceived market for its planned economic activities under its Vision 2030 development agenda.
Trade and investment relations between the UK and the GCC will depend on the strength of their individual relations with Britain, the report said.