Strong Prospects for Growth in UK Cyprus Trade
Following his recent official visit to Cyprus, Her Majesty’s Trade Commissioner for Europe, Chris Barton, CMG, elaborates on why he believes that vast opportunities
exist for further collaboration and strengthening short- and long-term trade and business relations between Cyprus and the UK.
By Athena Yiazou
Photo by TASPHO
What is the role of Her Majesty’s Trade Commissioner for Europe and how do you ensure that this role is successful?
My role as HMTC for Europe is to encourage trade and investment between the UK and other European countries. I lead a team of around 340 people working across 34 markets across the continent, including EU Member States, the EFTA states, the Western Balkans and Israel. We work to analyse opportunities, advocate UK interests and assist UK companies. In particular, we work to help UK companies seeking to export to Europe, European companies wanting to invest in or buy from the UK, and with European governments to reduce unnecessary barriers to trade and work together to support a free and fair international trading system. We place a particular focus on sustainability in our work, both as a guiding principle and a huge opportunity for trade and investment.
Where does Cyprus feature in the overall trade relationship between the UK and Europe?
Cyprus is an important bilateral partner for the UK on many fronts. Total trade between us is worth around £3 billion a year and it increased by 5% in 2021. We have around £8 billion worth of investment in each other’s country and we also enjoy unparalleled personal connections and shared values. Key sectors for UK exports to Cyprus include financial and professional services, tourism, vehicles and sustainable transport, pharmaceuticals, food and drink and other fast-moving consumer goods (FMCGs). To give an indication of the strength of the links, in 2020 the UK had a 15% market share for services in Cyprus. I was delighted to pay my first official visit to Cyprus as Trade Commissioner in May. This was a great opportunity to see first-hand the fantastic opportunities for strengthening trade across all sectors, including particular opportunities in renewables, technology and pharma. One recent example of the work we are doing to further promote trade linkages was when a Department of International Trade (DIT) Delegation covering the Midlands region in England visited Cyprus to meet with Cypriot importers of UK food and drink products. The purpose of the visit was to explore whether there is a desire among Cypriot importers to expand the range of UK products they import. The DIT team also wanted to present to the Cypriot businesses a selection of high-quality food and drink products sourced from the Midlands region. This project is now progressing and we are hoping to invite some Cypriot importers to the UK for face-to-face meetings with potential suppliers. Our fantastic DIT team in Cyprus is always ready to assist British and Cypriot businesses with expanding their trading activities.
As the effects of the changes following Brexit become more apparent, what have been some of the main obstacles to trade between the UK and its long-term international partners – including Cyprus – and how are these being overcome?
There have inevitably been some changes to our trading relationship since the UK left the EU single market and customs union. In some cases, that has meant some new challenges for exporters and we saw a short-term reduction in UK exports in the first months following our exit but export levels swiftly rebounded from that initial drop.
The prospects for growth in our trade are strong. The Trade and Cooperation Agreement (TCA) is a world-class free trade agreement, at least as good as any other trade deal that the UK or EU have with any other market outside the customs union and single market, providing a great basis for our trade to flourish. We have enormous opportunities for shared gains as we rebuild from COVID-19, encourage clean growth, and level up living standards across our nations. The UK and Cyprus have great products, excellent business and close relationships, which provide the basis for a thriving trade relationship.
We also have a range of measures in place to help businesses adapt to the new trading arrangements and exploit the opportunities. For example, we provide advice and guidance to companies to help them understand new requirements, e.g. additional paperwork and customs procedures. In particular, we have set up an Export Support Service to simplify and improve access to guidance for businesses, especially SMEs. You can ask any question for your business, including on exporting to new markets, the paperwork you need to sell your goods abroad and the rules for a specific country where you want to sell services.
We also work to resolve barriers as and when they arise. A good example relating to Cyprus was the recognition of professional qualifications for the Accountancy profession. We worked closely with the Cyprus Government and other stakeholders in Cyprus and the UK to ensure that the UK Accountancy qualifications continue to be recognised in Cyprus through the existing Cyprus legal framework, which allows unilateral recognition of qualification from third countries. This illustrated the willingness and desire of all stakeholders to work together for a positive outcome.
Additionally, we help equip businesses to make the most of the opportunities for export. For example, the Europe Trade Hub is a valuable entry point to export support across Europe. It has supported over 1,500 companies over the last 30 months and helped to deliver £90 million in export wins. Furthermore, our new Exports Academy provides a comprehensive training and upskilling programme to current and future exporters, across a range of sectors.
During your visit to Cyprus, you met with the Minister of Energy, Commerce & Industry. What was the main focus of your discussions? Did they include specific areas of possible collaboration between the two countries?
I had the pleasure of meeting the Minister of Energy, Commerce & Industry, Natasa Pilides and the Permanent Secretary of the Ministry, Marios Panayides, with my good friend Loucas Symeonides leading on Trade Policy and Bilateral Relations. We discussed the existing very positive trade relations between our two countries and areas for further collaboration and exchange of expertise. The Minister explained the new Green Energy plan for Cyprus and the need for greater use of clean energy. This is a priority sector for the UK and we are ready to collaborate with the ministry and the Cypriot business community in this sector. We focus on developing further sources and the storage of renewable of energy. We also discussed our common interest in the development of technology and the services sector, where the UK and Cyprus already collaborate closely.
The UK government has set out its Green Agenda and, more recently, the Secretary of State for International Trade announced the UK’s Green Trade Policy. What is Green Trade and how can the UK’s traditional trading partners like Cyprus be involved in and benefit from the Green Trade Policy?
Our Green Agenda involves promoting sustainable economic growth through trade (green exports) and investment, enabling the transition to low-carbon solutions. There now is a double urgency to transform Europe’s energy system and end dependence on Russian fossil fuels. International trade has a key role to play here. Moving to a zero-carbon economy will require unprecedented levels of investment to transform our energy, transport, housing and wider infrastructure. We need international capital for this and this requires partnerships with visionary businesses.
To create the right conditions for enabling clean growth, the UK and the EU (through its Green Deal) have set a clear path for action in the years ahead. Green trade is predicted to be worth £1.8 trillion by 2030, delivering up to £170 billion of export sales in goods and services for the UK by 2030. We have identified a pipeline of projects worth nearly £650 billion and offer a highly attractive investment climate. Similarly, the UK’s new strategy to boost international exports to £1 trillion – ‘Made in the UK, Sold to the World’ – was launched during International Trade Week in November 2021, and reiterates our commitment to boosting green trade. There are opportunities for businesses from a wide range of sectors – especially tech, clean economy, digital and creative and also including financial, professional and business services, tourism, education, life sciences, healthcare & chemicals, defence & security, aerospace, automotive, maritime and shipbuilding, space, infrastructure and agriculture. This autumn, the UK government will be hosting a new Green Trade and Investment Expo in the north-east of England. This will place a significant focus on both exports and investment and there will be opportunities for businesses in Cyprus to get involved and find out more about collaboration.
Another area in which the UK is currently making significant efforts is its Levelling Up Agenda, which aspires to spread the benefits of trade and investment across the whole of the UK. How can other countries benefit from this?
At the beginning of this year, the UK Government published its Levelling Up Strategy, designed to level up living standards across the UK. Trade and Investment have a key role to play in this. They drive economic growth, create jobs and improve living standards. In the words of the levelling up strategy, it spreads “joy and jobs” across our nations. This is a fundamental driver for our trade and investment work in Europe and beyond. We want to encourage exports from across the UK and attract inward investment into all parts of the UK, helping UK and European businesses take full advantage of the enormous and exciting trade opportunities in both directions.
We aim to increase the number of FDI projects into the UK and exports from the UK, to come from areas of the UK outside of London and the South-East. To support this agenda, I’ll be going on a week-long tour of the UK this month to talk to businesses in different regions across the country about the scale of the market, the breadth of sectors and the range of opportunities across Europe. This will also be an opportunity for me to visit our new DIT Hubs in Darlington, Cardiff, Edinburgh and Belfast, to build stronger linkages with DIT teams across the UK and our DIT teams in Europe, to the long-term benefit to businesses in both the UK and in Europe.
You have in the past suggested that the transition to a low-carbon economy, technology and healthcare are amongst the areas with the most potential for significant growth. Can you elaborate?
We see opportunities across all sectors, particularly in those sectors of the future in which UK excels, such as tech and clean growth. In DIT Europe, we are working to prioritise export and investment projects under our two dedicated umbrella campaigns in Europe on Clean Growth and Technology.
These sectors are key elements underpinning the Prime Minister’s 10-point plan for a Green Industrial Revolution, which will mobilise £12 billion of government investment, and potentially three times as much from the private sector, to create and support up to 250,000 green jobs across all regions of the UK. On the inward investment side, this is great news for investors looking to expand into the UK.
How do you expect trade between Cyprus and the UK to develop over the coming decade? What messages did you receive from the Cypriot business community in terms of areas and sectors offering opportunities for further collaboration?
The messages from all my meetings and discussions with Cypriot businesspeople and with the Minister of Energy, Commerce & Industry were very positive. Trading links are strong and very close and there is a palpable desire to develop them further. There are many areas of common interest where we can collaborate for the mutual benefit of the two countries. We have sectors that are already mature and well developed, including travel and tourism, financial and professional services, and trade of a plethora of goods including food and drink. One great example is in the area of technology. UK firms have highly developed expertise and experience in various areas of technology, Artificial Intelligence and smart cities. The UK government offers specific schemes for innovative start-ups to set up and develop in the UK. We also have a plethora of expertise, products and services in the environment, renewable energy and circular economy sectors, which could benefit Cyprus in its efforts to implement its Green Plan.
We already collaborate in the education sector and we could develop this further, with UK universities collaborating with Cyprus universities and offering courses to local and international students as well as collaborating on academic and innovative research programmes. So, I believe that there are vast opportunities for further collaboration and strengthening our trade and business relations, both in the near future and long-term.