Frankly: terrorism threat won’t deter expansion of UK investment in Middle East, UK trade official says
DUBAI: Escalating terrorist attacks by the Iran-backed Houthis will not deter British companies from increasing their investments in the Middle East, the British official responsible for his country’s trade with the region has told Arab News.
“The GCC, and within it the UAE, have been very popular destinations for UK exporters and tourists for many years, and we certainly don’t see a decline in that interest,” said Simon Penney, delegate. British commercial for the Middle East. Is said.
“In fact, the Gulf is more broadly the UK’s third largest export market globally, outside of the EU. We are very confident and have every reason to believe that our position as an exporting nation to the Gulf will improve further in the years to come.
He was speaking after a series of airstrikes on the United Arab Emirates, claimed by supporters of Yemen’s Houthi militia, in an escalating terror campaign that has seen drones and missiles targeting population centers and civilian infrastructure in Saudi Arabia.
British authorities have warned British citizens of an increased threat and urged them to be vigilant, ahead of a visit by Prince William, Duke of Cambridge, to the United Arab Emirates this week. But Penney insisted such threats would not dampen British business enthusiasm for investing in the region.
“We continue to see a very strong and healthy pipeline of companies doing business here,” he said.
“In fact, just last week we had (in Dubai) Arab Health (trade show). Over 140 UK companies made the trip here which was fantastic to see, not just in light of the events that you highlighted, but also after two years of COVID-19.
In an extensive interview on ‘Frankly Speaking’, the series of video chats with the region’s top policymakers and businesspeople, Penney – who is also the British consul in Dubai – spoke of the “passionate” interest of British companies for many sectors of Saudi Arabia’s Vision 2030 economic transformation strategy, the looming prospects of a UK-GCC free trade agreement and the potential for the Middle East to help offset some of the trade the UK gave up in the post-Brexit world.
Penney, a banker in the Middle East before taking up his current role in 2018, highlighted Saudi Arabia’s attractions as a UK trading partner.
“I must say that I am very passionate about the Kingdom. I have been working there in my various jobs for over a decade now and am as excited if not more today than I have ever been for the opportunities that exist in the Kingdom and across the Kingdom.
“It’s not just about Saudi Arabia. We see a lot of activity in Qatar, obviously, with the FIFA World Cup coming up later this year, but also beyond, in Oman, Bahrain and Kuwait. There is really a lot of interest in this region in both directions.
He added: “In fact, it was only the week before last that I had the opportunity to visit NEOM and I was absolutely blown away by the scale of the project, by the ambition of the project, of what really can only be described as a blank sheet of paper today.
UK interest in Saudi Arabia was strong across all sectors that were boosted by the Vision 2030 strategy, he said, including health, education, food and drink, as well as recreation and entertainment.
“And energy, of course. You know, as the Kingdom and the world embark on this journey of energy transformation towards “clean growth”, we are seeing a growing interest in “clean growth” and how we can work with the Kingdom to develop the technologies of the future,” Penney, referring to the goal of simultaneously increasing national income and reducing greenhouse gas emissions.
British businesses in the region were increasingly looking to Saudi Arabia rather than other GCC countries.
“In the UAE alone, we have 5,000 British businesses that call the UAE home but, interestingly, as these businesses increasingly seek future business opportunities in the region, it’s really clear that the Saudi Arabia, in particular, is going to be a major source of opportunity for these companies,” he said.
Penney spoke about the UK’s reaction to recent proposals by the Saudi government, which will require multinational companies to have their headquarters in Riyadh in order to conduct official business in the Kingdom.
“I think it’s varied. I know a lot of big UK companies that have been in the UK for a while and are embracing this because it makes business sense – that’s where the majority of the business is that companies are starting to do, and you know it makes sense to be located in the Kingdom,” he said.
“I know other companies have a bit longer-term watchdog mandate on this. But I think companies will make decisions about what makes business sense. Certainly in many companies with that I’ve talked about, based on what I’ve said about the magnitude of the opportunities that Saudi Arabia presents, that would actually be a good business decision.
Penney said: “It’s not just about Saudi Arabia. We see a lot of activity in Qatar, obviously, with the FIFA World Cup coming up later this year, but also beyond, in Oman, Bahrain and Kuwait. There is really a lot of interest in this region in both directions.
As someone who has been closely involved in the preparations for a UK-GCC Free Trade Agreement, Penney outlined the next steps in this negotiation process.
“We will launch negotiations for a GCC free trade agreement in the spring of this year,” he said.
“We have just concluded a parliamentary process, which is a unique process in the UK that we must go through before we can start negotiations on an FTA. This 14-week consultation ended in mid-January.
He added: “We are now going through a process of assimilating and capturing all the feedback we have received from companies and stakeholders during this consultation period. We take this into account in the negotiation strategy and approach that the UK will take as we enter into these FTA negotiations with the GCC.
Since the decision to leave the EU, the UK has been seeking to set up trade alliances with other major economic blocs as part of the “Global Britain” strategy. However, Penney insisted that a UK-GCC deal was not just a way to make up for lost business with Europe as a result of Brexit.
“On the contrary, I think it will stimulate more business. The GCC is already the UK’s third largest export market, outside the EU, the third behind the US and China,” he said.
“So already today the Gulf is very prominent in the minds of UK exporters. We are confident that by putting in place a free trade agreement, we will be able to further reduce some of the hurdles and obstacles that companies face in doing business here, which are not unique to the Gulf.
Penney insisted that political uncertainty in the UK, where Prime Minister Boris Johnson is increasingly beleaguered after a series of scandals, would not deter Middle Eastern investors from doing business with the Kingdom. -United.
“We see no slackening of investor interest in the UK,” he said.
“In fact, since leaving the EU and the 2016 referendum in particular, we have seen investor interest increase exponentially. I would say confidence in the UK is probably the highest we have seen in a very long time. »