Gulf exposed on EU-UK trade talks as Johnson rejects EU pre-conditions
The UK prime minister and the EU’s chief negotiator Michel Barnier set out on Monday (3 February) their separate stalls for the talks, which are set to start within weeks.
In Brussels, Barnier unveiled the EU’s draft negotiating mandate and said that negotiations can begin “immediately” once the mandate is approved by the EU Council at a special summit on 20 February.
Across the Channel in London, however, a typically bombastic address by Boris Johnson promised that the UK would use its new status to make the case for free trade which he said was being “choked” by ‘mercantilists and protectionists’ in ‘Beijing, Brussels and Washington DC’.
“We want a free trade agreement, similar to Canada’s, but in the very unlikely event that we do not succeed, then our trade will have to be based on our existing Withdrawal Agreement with the EU,” added Johnson.
That tough stance re-opens the prospect of the UK leaving the single market without a deal and reverting to WTO terms.
There is a tight timeline. The UK will leave the Single Market and customs union on 31 December, and analysts say a new deal would need to be agreed by late-October in order for it to be ratified in time.
The two sides are expected to prioritize striking arrangements for the sectors that are most vulnerable to a no-deal scenario.
In the meantime, Barnier told business leaders that they “must adapt now to this new reality”.
Britain’s all-you-can-eat approach to global trade
For the first time in more than 40 years, the U.K. will take its seat alone at the trade negotiating table — and it is immediately preparing to tuck into several meals at once.
Even before launching talks on future trade terms with the EU, Britain is already mapping out its framework for deals with countries such as the U.S., Japan, Australia and New Zealand.
Prime Minister Boris Johnson hopes that Britain’s global reach will give him leverage, as the EU increasingly frets that the U.K. will become a free-wheeling Singapore on its border, closely bound to the U.S. and Asia. Brussels wants to use its trade negotiations with Britain as a way of locking the U.K. into its regulatory framework, and Johnson is out to show that there are alternative economic models on the menu.
Johnson’s main problem, however, is that officials from many global trade heavyweights in the Americas and Asia point out that there is little point in closing a deal with the U.K., despite its rich consumer market, until it is clear what the future relationship with the EU will be. Asian investors will want to know, for example, whether they can manufacture cars and machines in Britain and then export them tariff-free to the EU27.
As a member of the EU, Britain effectively outsourced its trade policy to Brussels. Thanks to EU negotiations, Britain has been part of tariff-slashing deals with countries such as South Korea, Japan and Canada. It will now need to renegotiate these, but without the muscle of the world’s biggest trade bloc — and its 450 million consumers — behind it.
UK to implement new global trade tariffs from 2021
Britain plans to develop a new tariff schedule which will enter into force at the start of 2021 and will apply to goods from countries around the world where no other trade arrangements are in place, the government said on Thursday (6 February).
The government has launched a four-week consultation to help shape its new most favored nation tariff regime, which will be known as the UK Global Tariff. This could include simplifying tariffs and removing tariffs completely on goods where Britain has no domestic production, it said.
“It is vitally important that we now move away from complex tariff schedule imposed on us by the European Union,” trade minister Liz Truss said in a statement.
“This is our opportunity to set our own tariff strategy that is right for UK consumers and businesses across our country.”
90 projects under construction at Al Mazunah Free Zone in Oman
Al Mazunah Free Zone Committee held its first meeting this year under the chairmanship of Hilal bin Hamad al Hasani, Chief Executive Officer of the Public Establishment for Industrial Estates (Madayn).
The meeting discussed several aspects related to driving greater efficiency of services that are offered to the investors and business owners, and development of infrastructure in the free zone. The meeting also highlighted the projects that Madayn is currently implementing in the free zone, which include the second phase of the free zone is now 60 per cent complete.
Al Mazunah Free Zone was established under Royal Decree 103/2005 to operate under the management of the Public Establishment for Industrial Estates — Madayn.
The strategic location of the free zone on the border of the Sultanate and Yemen makes it the Gulf gateway for transit trade to Yemen and Eastern Africa.
General incentives are offered to investors in the free zone, including customs’ exemptions, 100 per cent foreign ownership, no minimum capital requirements, and Omanisation rate stands at 10 per cent. Other incentives include easy access of individuals and investors to the free zone without entry visas being required for Yemenis, facilitation of employing Yemeni workforce without work visa being required, in addition to other incentives.
LogiPoint completes phase 1 of Logistics Park Modon in Saudi Arabia
LogiPoint, a leading logistics zones developer in Saudi Arabia, has announced the completion of phase 1 of the Logistics Park Modon 1 project.
Phase 1 comprises 350 truck parking spaces designed to bring Modon much needed respite from congestion and pollution through taking the parked and waiting trucks off the roads, said a statement.
Modon tenants and service providers will have the option of leasing truck parking space, which complies with international security and safety standards, on daily/monthly/yearly lease as per their requirement.
Modon hosts more than 400 factories in the Jeddah Industrial Area. This thriving industrial base needs a state-of-the-art logistics infrastructure, which helps bring world-class efficiency to its operations, it added.
Upon completion, the project located in the heart of the Jeddah Industrial Area, will include a 20,000-sq-m of multi-temperature warehouses, which will be the only one catering to all kinds of storage requirements of the industrial city, said the statement.
It will offer customized and tailor-made support services to the clients and boost supply chain efficiency across sectors through sharing best practices and leveraging expertise and experience. The Modon investors will benefit from improved ROI because of highly professional and cost-effective storage and distribution becoming available in their vicinity.
Farooq Shaikh, CEO of LogiPoint, said: “LogiPoint has set out to build on the success of the Bonded and re-export zone and to develop similar high quality integrated facilities throughout the kingdom.”
Egypt pens agreements to settle overdue export subsidies with 31 companies
The Egyptian finance minister Mohamed Maait and the minister of trade and industry Nevine Gamea have signed agreements with 31 companies to settle overdue export subsidies.
Under the agreements, export subsidies owed by the Export Development Fund will be paid over five years to companies which will be committed to injecting new investments, setting up new production units, and expanding their production capacity, according to a statement on Monday (3 February).
The companies include Cairo Poultry, Egyptian Starch and Glucose, Panda, AGRANA Nile Fruits, Agrocorp, Farm Frites Egypt, Procter & Gamble Egypt, GoldenTex, and Hayat Egypt.
In addition, the finance ministry will sign a new batch of agreements with several companies to settle overdue export subsidies within days, the deputy finance minister, Ahmed Kouchouk, said.
It is noteworthy that a total of EGP 291 million worth of overdue export subsidies has been disbursed to 12 companies at the end of December 2019, Gamea revealed.