More good news for the UK’s Fintechs, with the news that negotiations are underway to sign a digital economy agreement (DEA) with Singapore.
“The DEA will strengthen the linkages between the UK and Singapore and allow both countries to function as twin digital hubs in our respective regions,” a joint statement from the two governments read. “This will enable UK and Singaporean enterprises of all sizes, especially small and medium enterprises, to access a greater range of opportunities in our combined digital markets.”
The digital economy agreement is designed to serve as one of the cornerstones of the UK’s post-Brexit economy, encompassing moves to remove barriers and open further opportunities for British businesses to deliver their services through digital trade.
The value of that trade is considerable. It is estimated that more than two-thirds (70%) of UK services – including financial and legal services to music streaming and e-books – were digitally delivered to Singapore in 2019, worth £3.2 billion.
UK Trade Minister Lynn Truss said any new deal with Singapore would keep the UK at the forefront of the technological revolution, “Ensuring we lead the way in digitally delivered trade and industries like fintech and cybersecurity.
“We are already the second largest services exporter in the world, with a huge comparative advantage in this area that we intend to capitalise on.
“We are becoming more flexible, more nimble and less defensive in our approach to trade. Our ambition is to make the UK a global hub for services and digital trade.”
According to the government, the DEA will establish forward-looking rules to facilitate trusted cross-border data flows, prohibit unjustified data localisation, and maintain high standards of personal data protection. It will champion the role that digital technologies can play in facilitating trade, encourage interoperability in our digital systems, connect the thriving innovation ecosystems in the UK and Singapore, and explore the use of emerging and innovative technologies.
Miles Celic, chief executive at financial services group TheCityUK, said: “As leading international financial centres and data hubs, there are tremendous opportunities to be gained from the UK and Singapore working together on digital trade issues that support and supercharge innovation.
“Working with like-minded countries like Singapore presents a real opportunity to develop a best-in-class digital agreement.
“Digital restrictions are among the fastest-growing trade barriers. Over 50% of trade in services is facilitated by digital exchange, but restrictions on digital trade doubled in the decade leading up to 2019.
“To ensure the future of open global services trade, it’s essential that new agreements support the flow of data across borders. The UK should strive to set clear ground rules for digital trade and build an open and robust framework for future digital trade and technological cooperation.
“Such a framework can then become a template for other key markets, aiding the free flow of data and preventing unnecessary market fragmentation.”
The deal marks another element of the UK’s efforts to become the pre-eminent digital economy in Europe by developing frictionless trade deals with countries around the world.
If you’re in need of advice or support in this or any other area, we’re right here for all your needs. You can contact us for help from tax and payroll to accounting and banking.