Nigel Huddleston, International Trade Minister, initiated a pivotal journey to Peru and Colombia. The primary objective of the journey is to bolster trade ties and address the persistent challenges that have limited UK exports to Latin America.
This isn’t merely a diplomatic gesture. Huddleston intends to introduce measures that will streamline operations for British pharmaceutical firms in Colombia. By doing so, he’s hoping to pave the way for an expansive market, allowing Colombia to benefit from vital medical commodities, while also creating lucrative opportunities for UK businesses.
Data from the past year shows a commendable effort by the UK, successfully navigating around £1.3 billion of trade impediments that had previously restricted the reach of UK businesses into the Latin American and Caribbean regions. To put things into perspective, this vast region, home to 8% of the global population, registered an economic output of £4.7 trillion in 2022. Predictions suggest this number will swell to a remarkable £8 trillion by 2035, representing about 5.2% of global GDP.
Given these promising figures, it’s evident that UK businesses have a golden opportunity to not only cement but also expand, their £40 billion trade relationship with these growing economies.
Expressing enthusiasm, Huddleston stated, “Latin America presents incredible opportunities for British businesses, and we aim to put them at the front of the queue by making it easier to sell and establish a presence in countries like Colombia and Peru.” He underscored the UK’s strategy, which involves active trade dialogues, leveraging CPTPP membership, and removing trade barriers, as the pathway to global expansion.
Key discussions during Huddleston’s visit include Propelling initiatives related to Colombia’s emerging green hydrogen sector. Brokering a Double Taxation Agreement to circumvent dual tax burdens, thus enhancing Peru’s appeal to investors. Addressing the skewed tax regime in Peru that affects imported liquors, especially Scotch Whisky.
Additionally, Huddleston will engage with potential investors and business leaders in Peru. This interaction is geared towards exploring opportunities following the UK’s recent integration with the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).
Earlier this year, Business and Trade Secretary Kemi Badenoch outlined her strategic focus, which involved resolving critical global trade barriers. Her ambition is to unlock export avenues valued at approximately £20 billion for UK enterprises.
Ian McKendrick, representing the Scotch Whisky Association, expressed his gratitude for the ongoing governmental support. He emphasized the critical issue of tax discrimination faced by Scotch Whisky in Peru, which contravenes WTO standards. This uneven taxation has further exacerbated issues like illegal alcohol production, leading to substantial fiscal losses for Peru.
Addressing these challenges remains a top priority for the whisky industry, especially given Peru’s potential to significantly elevate the industry’s global standing. As Huddleston’s visit unfolds, it’s clear that there’s an overarching sense of optimism regarding the transformative shifts this venture promises, especially in reshaping the UK’s trade dynamics with Latin America.
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