British Prime Minister Keir Starmer arrives at the airport in Jeddah, Saudi Arabia, on April 8, 2026.
Alastair Grant | AFP | Getty Images
Britain on Wednesday hailed its “historic” trade deal with the Gulf state, the first of its kind among the Group of Seven (G7) countries.
Announcing the agreement, the UK Department of Trade and Industry (DBT) said the trade deal would boost the UK economy by an estimated £3.7 billion ($4.9 billion) each year, and could increase wages by £1.9 billion a year in the long term.
DBT said in a statement: “The UK today became the first G7 country to sign a trade deal with the Gulf Cooperation Council (GCC), potentially boosting growth and increasing wages for decades to come. This means strengthening economic links with the region, supporting jobs in the long term and strengthening domestic resilience.”
On April 9, 2026, British Prime Minister Keir Starmer (left) welcomes British Prime Minister Keir Starmer (left) on his arrival for a visit to Abu Dhabi, United Arab Emirates, by Khaldoon Khalifa Al Mubarak, Head of the Emirate.
WPA Pool | Getty Images News | Getty Images
The UK government said the agreement with the GCC, which comprises Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates, reflects the UK’s “solidarity and long-term cooperation with the Gulf states”.
If fully implemented, the agreement would eliminate an estimated £580m of customs duties a year based on current UK exports to the GCC, of which £360m would be “eliminated on the first day the agreement comes into force”, it said.
British exports of cereals, cheddar cheese, chocolate and butter are just some of the items expected to be duty-free under the terms of the deal.
Cheddar could be one of the UK foods to benefit from trade deals with Gulf countries.
Leda | Universal Images Group | Getty Images
This is the fifth major trade deal signed under the current UK government, following deals with India, the US, the EU and South Korea.
The deal is a welcome boost for British Prime Minister Keir Starmer, who faces challenges to his leadership as the British economy comes under pressure from the Iran war.
Commenting on the latest trade deal, Mr Starmer said: “Today’s deal is a huge win for British businesses and for working people who will see the benefits through higher wages and increased opportunities in the coming years.”
“Gulf countries are important economic partners and this agreement will deepen that relationship, build trust and unlock new potential for trade and investment,” he added.
