UK Provides Russian Exporters With Reduced Import Tariffs Under New UK Global Tariff Scheme
The United Kingdom has informed Russia of its new UK Global Tariff Scheme (UKGTS) which comes into force from 1st January 2021. The UKGTS rates come in due to the United Kingdom leaving the EU-wide tariffs and customs union on that date.
New customs rules will apply to goods exported from countries that had no signed preferential trade agreements with the United Kingdom, including Russia. Such UK global tariffs are called to provide simpler and more convenient regime, compared to European tariffs. It is intended to simplify the process of goods export to the United Kingdom for Russian companies and will make possible to reduce costs when selling to the British market.
More about the scheme can be read here
In the year to June 2019, total UK exports to Russia amounted to £5.3 billion, making it the UK’s 25th largest export partner. Numerous opportunities are available to UK companies in the consumer, food, life sciences, oil and gas, agri-technology, education and fintech sectors.
The top goods imported by Russia from the UK in the year to June 2019 were cars, medinical and pharmaceutical, mechanical power generators, industrial machinery and works of art (ONS, 2019). If your business is looking to export goods like these, Russia could be a good market for you.
GDP has been increasing in Russia since 2016. It rose by 2.3% in 2018 and is predicted to grow by 1.1% in 2019, with this upward trend continuing for at least the next 5 years (IMF, 2019). This should increase the spending power of the Russian population, and benefit UK exporters.
The move can be expected to lead to an increase in bilateral trade between the countries, especially given that the EU has imposed sanctions on Russian goods, and the UK is about to leave the customs union. Now is a good time for British businesses to begin researching opportunities for the Russian market, and vice versa.
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Russia Briefing is written by Dezan Shira & Associates. The firm has 28 offices throughout Eurasia, including China, Russia, India, and the ASEAN nations, assisting foreign investors into the Eurasian region. Please contact Maria Kotova at email@example.com for Russian investment advisory or assistance with market intelligence, legal, tax and compliance issues throughout Asia.