A newly agreed global deal on services could cut paper documentation, saving up to 7% in annual trade costs worth £113bn.
The Services Domestic Regulation was agreed by 67 World Trade Organization (WTO) and will reduce regulations such as licensing requirements placed on service providers operating in other countries.
Signatories have committed to greater transparency, legal certainty and an easier regulatory process with electronic applications and clear and reasonable fees, reports Reuters.
Cutting red tape
Countries signed up include the UK, US, China and EU members, with the group of 67 representing 90% of all services trade.
As the world’s second-largest services exporter, the UK is among the countries set to benefit from the new terms, said the government.
The UK has been a “strong and vocal participant” in negotiations that were launched in Buenos Aires in 2017, it said.
Trade minister Anne-Marie Trevelyan said the pandemic has shown the importance of cutting red tape and getting trade flowing.
“We are delighted to have played our part in bringing about this historic deal, which shows exactly the kind of cooperation we want to see at the WTO and demonstrates it can deliver trade rules fit for the 21st century,” she said.
Broad application
The UK will be among a handful of nations applying the new rules across the broadest possible range of services sectors, including financial services where London is Europe’s leading centre.
The biggest savings are likely to be in finance and tech, and the deal was well received by the finance and legal sector.
Catherine McGuinness, policy chair of the City of London Corporation, said: “This is a welcome development for the UK financial and professional services sector, with global services providers set to benefit from the removal of unnecessary administrative processes that can act as barriers to market access around the world.”
The World Economic Forum outlined five benefits of the new regulation:
- Lower trade costs
- A boost to services growth and trade
- Higher participation in global value chains (GVCs) resulting in greater productivity and diversification of exports
- Small businesses and female entrepreneurs will gain
- A path to more flexible approaches to trade cooperation at the WTO
UK digital trade growth
The new regulation comes as Britain focuses on digital services as a key export area. A report by the Board of Trade highlighted the potential for digital trade to drive economic growth, with £200bn of digitally delivered services exported internationally in 2019.
Public Technology reports that Britain is looking to strike digital trade deals as a means of opening up online opportunities for British businesses.
UK-Singapore digital trade pilot
Meanwhile, three Memoranda of Understanding (MoUs) have been signed by UK digital secretary Nadine Dorries and her Singaporean counterpart Josephine Teo, reports Electronics Weekly.
An agreement on ‘digital trade facilitation’ aims to reduce barriers to digitally led trade by encouraging businesses to use electronic invoicing. It will establish a pilot project for the transfer of electronic bills of lading between the UK and Singapore.
The agreements will underpin the UK-Singapore Digital Economy Agreement (DEA), currently being negotiated.