WTO’s Landmark Deal To Cut Trade Costs

The UK has signed a deal with other members of the World Trade Organisation (WTO) which could cut trade costs by £113 billion a year. This is the first negotiated agreement on services at the WTO in a quarter of a century.

67 members have agreed to cut red tape surrounding licensing and qualifications, including the US, EU and China. Whilst this is a minority of the 164 members, it represents 90% of all services trade.

Many businesses have found that complex administrative procedures form a barrier when trying to access international markets, but the new rules will make it easier for businesses to navigate them and obtain authorisation to export overseas.

Once in place, businesses can expect licensing applications to be more timely, with acceptance of electronic copies of qualifications by competent authorities and an end to unreasonable and hidden fees.

As the world’s second largest services exporter, the UK is expected to do well from the deal. The service sectors which are predicted to benefit the most include banking, information technology, telecoms, architecture and engineering. These savings will help retain London’s position as Europe’s leading financial centre.

The Organisation for Economic Co-operation and Development (OECD), an international policy forum, has estimated that by implementing looser regulations in the world’s top 20 economies could reduce trade costs by up to 6%.

The regulations are aimed to come into force in 2023.