Fox seeks stronger ties with Gulf states

Posted on September 19, 2016

Liam Fox, leaves after being named as U.K. international trade secretary, after a meeting with Theresa May, U.K. prime minister, at 10 Downing Street in London, U.K., on Wednesday, July 13, 2016. May became the U.K.'s second female prime minister and has promised to take Britain out of the European Union. Photographer: Simon Dawson/Bloomberg©Bloomberg

Liam Fox, international trade secretary, is pressing ahead with informal discussions on future deals outside the EU

Liam Fox is looking to deepen the UK’s trading relationship with the Gulf states in a move that is raising fresh concerns about how far the government is prepared to turn a blind eye to human rights abuses in the region.

As the international trade secretary presses ahead with informal discussions on future deals outside the EU after Britons voted to leave the bloc, Mr Fox has been seeking to highlight how deeper trade links with the Gulf should play a central role in the UK’s evolving trading strategy.

    Britain and the intergovernmental Gulf Cooperation Council already have a strong trading relationship worth more than £22bn a year, with a hefty trade surplus for the UK. On visits this week to Bahrain, the UAE and Qatar, three of the GCC member states, Mr Fox is spelling out how he wants to take this relationship further, identifying 31 “big-ticket exporting opportunities” spanning hydrocarbons, defence, infrastructure, science and the creative industries.

    However, his visit has not been without controversy. In Dubai, the international trade secretary had been due to follow a speech to members of the British business community with an open question-and-answer session. But people familiar with the matter said Downing Street staff insisted on vetting the handful of questions put to the minister.

    Number 10’s apparent attempt to control Mr Fox’s public interactions may have been caused by growing concern in Theresa May’s team about gaffes that Mr Fox has uttered in recent days, most notably a comment that British business has become “fat and lazy”.

    Mr Fox’s visit — which is expected to be followed by trips elsewhere in the region, including to Saudi Arabia — is also certain to anger politicians and pressure groups who believe the UK has remained too close to Gulf states that have used force to suppress dissent since the Arab Spring of 2011.

    “The Conservative government has prioritised deepening its partnership with the Gulf, especially in trade and defence,” said Jane Kinninmont, deputy head of the Middle East programme at Chatham House. “But UK public opinion is very critical of that relationship, especially in Saudi Arabia and Bahrain, as well as over labour rights in Qatar.”

    Mr Fox’s trip is taking place as the UK is being increasingly criticised for supporting the Saudi-led military campaign in Yemen, where there is a mounting civilian death toll as Riyadh seeks to counter Houthi militias allied to Iran. Some pressure groups are planning to pursue legal action for the suspension of UK arms exports to Saudi Arabia that can be used in the Yemen conflict.

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    Britain’s pursuit of deals with GCC members comes as the EU’s own talks with Gulf nations have stalled. Negotiations between Brussels and the GCC have broken down over concerns over Saudi petrochemicals pricing and tariffs, as well as some EU members’ concerns over human rights in the Gulf.

    However, some analysts believe that in its rush to pursue a post-Brexit trade deal with the GCC, the UK may be forced to make concessions. GCC members are likely to demand a visa waiver for travel to the UK similar to the one they have with the 26 members of Europe’s Schengen agreement. If it accepted this, the UK would be running up against the demand for immigration curbs that fuelled the Brexit referendum result.

    Britain’s prospective exit from the EU is less troubling for the GCC than for other international investors, who regard London as a launch pad for access to Europe’s single market. Gulf nationals regard London as a home from home and are less interested in unfettered access into the European single market.

    When Boris Johnson, now foreign secretary, visited the UAE as London’s mayor he described the British capital as “the eighth emirate”, a testament to the historic and investment links between the two countries.

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