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Developing Countries Trading Scheme: Consultation

Volume 699: debated on Monday 19 July 2021

This morning, the Department for International Trade will be launching a public consultation on its new Developing Countries Trading Scheme (DCTS). Post-Brexit Britain can now take a more ambitious, generous, and pro-growth approach to trading with developing nations. The proposed scheme aims to grow trade with lower-income nations, supporting jobs and growth across the globe and at home.

This consultation will make sure that the public, business, civil society, associations and other interested stakeholders can have their say on the Government’s approach to preferential market access for developing countries.

We intend this new scheme to be best in class, and have studied programs in Canada, the US, Japan and the EU, before designing a uniquely British offer which backs growth, enterprise and ambition.

This is a major opportunity to grow free and fair trade with developing nations, allowing them to diversify their exports and grow their economies, while British households and businesses benefit from lower prices and more choice. The new UK scheme will mean more opportunity and less bureaucracy for developing countries, for example by simplifying rules of origin requirements for the least developed nations.

The UK currently operates a similar scheme rolled over from the EU, but as an independent trading nation can now take a simpler, more generous, pro-growth approach to trading with developing countries. It would apply to 70 qualifying countries currently and include improvements such as lower tariffs and simpler rules of origin requirements for countries exporting to the UK.

For example, this could mean lowering tariffs on products including rice from Pakistan and trainers from Nigeria. Bangladesh and Vietnam demonstrated that increasing trade through schemes like this one have helped them grow their economy, improve living standards, and drive down poverty.

For instance, Vietnam’s exports to the UK more than tripled between 2009 and 2019 while poverty rates plummeted from more than 20% in 2010 to an estimated 5.9% in 2020. Today, it is a fully-fledged FTA partner. We want more developing countries to follow in their footsteps.

The online consultation opens today on and will be live for eight weeks. It will be accompanied by an information note that sets out details of the existing UK preference arrangements. The new Developing Countries Trading Scheme will take effect in 2022.