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Last week the Secretary of State for Business and Trade, Kemi Badenoch, was in Rome to sign a landmark memorandum of understanding (MoU) with Italy to form an export and investment partnership. It marked her first overseas visit since taking on the new expanded role of Business and Trade Secretary, and she joined Italy’s Minister for Foreign Affairs and International Cooperation and Deputy Prime Minister Antonio Tajani to sign the UK-Italy Export and Investment Promotion Dialogue.
The partnership is the first the UK has signed with an EU country, and there is a commitment from both governments to ensure it is implemented in a way that helps reduce market access barriers in both countries and unlocks the potential of increased trade & investment flows. It exemplifies not only the importance of the economic partnership between Italy and the UK, but also the intention from both sides to grow a trade relationship that’s already worth more than £43 billion.
The value of trade between our two countries makes it one of the most significant trading relationships in Europe. Both the UK and Italy are in the top 10 global economies, with Italy being the UK’s 11th largest trading partner. Each year we export nearly £1 billion worth of cars to Italy, and over half a billion pounds worth of mechanical power generators, and that’s in addition to the financial, travel and business services that we export each year. We also import over a billion pounds worth of medicinal products, clothing and beverages from Italy to our shores each year, and the good news is that both export and import figures have grown over the past twelve months.
The MoU signed last week aims to further that growth, and to promote investment in both countries – in 2021, the outward stock of foreign direct investment (FDI) from the UK in Italy was £18.3 billion, and there’s room for this to grow too. This new partnership can help to boost trade and investment between British and Italian businesses, ease the path for valuable investment, and vitally it can help grow exports as the UK Government works towards our ambition of selling £1 trillion of goods and services a year to the world by the end of the decade.
One way in which this deal aims to achieve this is through strengthening exports in high-performing and growth sectors of the future, such as Life Sciences and Digital and Tech. We know that future economies will rely on new these high-tech growth sectors – and that’s why we want to increase opportunities and create jobs in these areas, and promote inward investment, including low-carbon industries such as Offshore Wind and Carbon Capture Storage.
The opportunities for growing trade between the UK and Europe trade are huge. Following the Covid-19 pandemic exports are now bouncing back, with our exports to the EU totalling over £330 billion in the 12 months to September 2022, an increase of nearly 25% in current prices from the previous year. While we have faced a number of challenges over the past few years, it’s now more important than ever to strengthen relationships to respond to these challenges.
That’s why this Export and Investment Promotion Dialogue has been signed. We want to reinforce the UK’s position as a vital trade partner within Europe and the G7, and demonstrate how we can use our position as an independent trading nation to agree comprehensive trade deals with new markets, while also strengthening partnerships with EU members.
We haven’t turned our back on the EU – in fact we’re strengthening our already prosperous relationship while banging the drum for free trade right across the world. Our Secretary of State has made her priorities for the upcoming year clear, and these partnerships are important as we cut market access barriers, boost exports and level up the nation through investment.
Three years on from Brexit, this is a chance to strengthen and deepen our ties with Italy as well as the wider EU.
Rachel Gwyon
Director, UK Nations and Agriculture, Food and Drink – Department for Business and Trade
14/02/2023
