High hopes of new UK-Swiss trade deal

Business chiefs have reacted with enthusiasm to the start of talks between the UK and Switzerland over a new free trade agreement (FTA) aimed at boosting financial and professional services exports.

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Kemi Badenoch, Britain's trade secretary, kicked off negotiations this week at a meeting in Bern with Swiss economy minister Guy Parmelin.The aim of the talks - which officials will discuss in detail at meetings starting on May 22 - is to come up with a new FTA covering services and areas such as business travel. At present, trade between the two countries is governed by a post-Brexit rollover deal that mainly only covers goods, not services.

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Meeting as service-sector superpowers

In a statement issued as the talks got underway, Ms Badenoch said: "The UK and Switzerland are natural trading partners and today’s launch will play to our strengths as services superpowers, while also boosting investment in emerging technologies, data innovation, and digital trade.“As two of the world’s leading service economies, there’s a huge prize on offer to both the UK and Switzerland by updating our trading relationship to reflect the strength of our companies working in areas ranging from finance and legal to accountancy and architecture."The Department for Business and Trade in London valued annual trade between the two countries at almost £53 billion pounds, making Switzerland the UK's tenth largest trade partner.A spokesman for the department said that, apart from a deal covering services, the UK was also seeking to ensure easy cross-border movement for business travellers, opportunities for increased private sector investment, and the removal of existing Swiss tariffs on British goods such as red meat, baked goods and chocolate.

Deal would 'fill a post-Brexit gap'

William Bain, head of trade policy at the British Chambers of Commerce (BCC), stressed the importance of the negotiations as Switzerland was the UK’s sixth largest export destination for services, worth £15 billion a year.“The 2021 post-Brexit continuity agreement only rolled over terms on trade in goods but not services, so there has been a major gap to fill, affecting just under half of our trade," he said.“As well as securing market access for our financial, legal, accounting, auditing, architecture and design service firms with the large Swiss market, we also need to make permanent the temporary services labour mobility and business travel rules agreed last year.“With scope to expand digital trade and bilateral data and investment flows with Switzerland, this is one of the most important sets of negotiations for business the UK government has launched in the post-Brexit era.”

Deal would bring significant benefits

Nicola Watkinson, international managing director at the financial services trade body, TheCityUK, said the successful negotiation of an FTA would bring "significant benefits to both markets, not least in key areas such as innovation, talent mobility and the recognition of professional qualifications".She added: “Industry wants to see an ambitious FTA that fits hand in glove with a UK-Switzerland Mutual Recognition Agreement, which is already under negotiation. Not only would such a deal be ground-breaking and help our industry provide more jobs and support economic growth right across the country, but it could also provide a cutting-edge template for future, similar deals with other key markets.”Marco Forgione, director-general of the Institute of Export & International Trade, also welcomed the start of negotiations, describing services as "an incredibly important part of UK trade" and a vital cog in the country’s economy.“Any support for this sector is a welcome step and we look forward to hearing more about how the government hopes to reinforce the status of the UK as a ‘services superpower’ by removing barriers to entry for lawyers, architects and other service traders,” he said.Chris Hayward, policy chair of the City of London Corporation, told the Guardian that “strengthening our services trade relationship is a top priority”. He added that any agreement would need to address common services issues such as mobility, data flows and digital trade.But while David Henig, founder of the UK Trade Forum, said the start of talks was a “positive” development, he also pointed out that the EU was the “elephant outside the room” because Switzerland would need to stay close to Brussels' rules in negotiations."Switzerland prioritises maintaining trade flows with the EU through a plethora of alignment agreements," he said, adding that Switzerland's relations with the bloc had improved recently following a series of disagreements.

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