Accra, June 20, GNA – The United Kingdom’s (UK) landmark Developing Countries Trading Scheme enters into force on Monday, June 19, 2023.
The Scheme cuts tariffs on products entering the UK from 65 developing countries and will help reduce import costs by over £770m per year, thus, benefiting the UK consumers and businesses.
This is to radically simplify trading rules and cut tariffs on products from developing countries, saving UK businesses and consumers millions of pounds a year.
The UK’s new post-Brexit Developing Countries Trading Scheme (DCTS) scheme – entering into force– covers 65 countries that are home to over 3.3 billion people, and more than half are in Africa.
It removes or reduces tariffs and simplifies trading rules so that more products qualify for the scheme, making it more generous than the European Union (EU) scheme, which the UK was previously a member of.
The scheme will benefit developing countries looking to diversify and increase exports, driving their prosperity and reducing their need for aid.
The scheme saves UK businesses over £770 million per year by removing or cutting tariffs on over £9 billion of imports – increasing choice for UK consumers and potentially reducing prices on a wide variety of items such as clothes, food and children’s toys, as well as creating opportunities for UK businesses to trade internationally and grow the UK economy.
It is expected that over time, developing countries would increase trade with the UK under the scheme, whilst businesses could save millions more on import costs.
The UK’s Minister for International Trade Nigel, Huddleston, launched the scheme while on a visit to Ethiopia’s largest industrial business park, Bole Lemi.
Ethiopia, which already has a trading relationship with the UK worth £838 million, pays zero tariffs on 100 percent of goods exported to the UK.
Under the new scheme, Ethiopia and 46 other countries will be able produce goods using components from many more countries, growing their opportunities to trade with the UK.
Speaking at the park, Minister Huddleston said the Scheme was a brilliant example of the UK taking advantage of its status as an independent trading nation and was excited to see it being implemented.
“It will create opportunities for businesses around the world, supporting livelihoods, creating jobs and diversifying local and international supply chains.
It will also benefit UK businesses and consumers by lowering import costs on a whole range of products.
The Foreign, Commonwealth and Development Office’s Minister for Development and Africa, Andrew Mitchell, said:
“The UK’s new trading scheme for 65 developing countries, DCTS, shows how we can use trade to deliver development.”
“It will benefit traders around the world, including women-owned businesses, which we are supporting through the UK Trade Partnership programme.”
While in Addis Ababa, Ethiopia’s capital city and home to many international corporations, Minister Huddleston will meet with the UK and Ethiopian companies to discuss how they will benefit from the DCTS and new ways they could work with local businesses and other governments to grow trade.
The scheme benefits businesses all over the world and British companies that trade with these countries in everyday products such as bicycles and camping gear.
The Executive Vice President at Specialised Bicycle Components Inc, Robert Margevicius, said:
“The DCTS enables us to maintain our supply chains in countries like Cambodia and continue to incorporate components from around the region, including from Vietnam.
“We are committed to supporting our workforce and maintaining quality.
“We manufacture high-value frames in Cambodia and Specialized uses preference scheme benefits to invest in this higher level of production.”
Head of International Logistics and Trade Compliance at Halfords, Ben Price, said the revised rules of origin under the Scheme would be hugely beneficial for Least Developed Countries and companies who are sourcing products from them. Under the previous regime many articles were precluded from benefitting from 0% duties due to the complexity of the rules of origin.
“The further liberalisation and rule options that have been introduced under the DCTS are incredibly helpful and will support business and economic growth in some of the poorest countries.
A great example of this is camping equipment, such as tents, from developing countries in Southeast Asia.”
The DCTS covers 37 countries in Africa, 26 in Asia/Oceania/Middle East and 2 in the Americas, representing varied and exciting trade opportunities around the world.
The UK imported an average of £22.8 billion worth of goods from DCTS countries over the last three years.
When combined with the UK’s network of eight Economic Partnership Agreements, the DCTS means over 90 developing countries now benefit from duty-free or nearly duty-free trade.
Customs processes will remain the same as under current preferential trading arrangements but new tariffs and rules of origin for Least Developed Countries will apply.
More information on the scheme can be found here: Trading with developing nations – GOV.UK (www.gov.uk)
GNA