The UK and Singapore launched negotiations this week on a new ambitious digital trade agreement that could remove barriers and provide access to digital trade.
Government statistics show this digital trading relationship was worth £3.2bn in 2019, out of Britain’s total tech exports of nearly £63bn globally.
As the value of the entire digital global market is worth close to £700bn, according to Nex Business and growing twice as fast as physical commerce, according to CBS Butler, so digital free trade agreements will be a growing priority for countries wanting to future-proof their economy.
In fact, tech is one of Britain most profitable exports. Britain is the fifth biggest exporter of digital and tech services, with a 55 per cent trade surplus in 2019.
Moreover, a recent report by Tech Nation ranked the UK fifth in the best places to do digital business.
It also found the UK was the fifth greatest exporter of digital tech services in the world, with a £23.3bn turnover in 2019, just behind India, the US, China and Germany.
High-growth tech hub
The reason the UK is able to punch above its weight like this is because it is home to nearly 8,000 high-growth exporting tech companies.
Many of which have room to grow their export business a lot further, and Singapore, as one of the four Asian Tigers, is a key market for this – and will only become more important as the digital world expands further, argued Nayan Gala, founder of London-based startup advisory JPIN Venture Catalysts.
“There has been a great focus on traditional trade and full free trade agreements thanks to Britain’s deal with Australia, however the future of trade will not be beef and wool, but rather, FinTech and e-commerce,” Gala told City A.M.
“This means that these digital agreements will become vital to futureproofing, and Singapore is one of the strongest digital economies in the modern world, making it the perfect partner for the UK similarly strong tech ecosystem,” he said.
“There will always be a trade of physical goods, however, as digital products grow to dominate world commerce, a seamless and borderless trade environment will be mutually beneficial to everyone,” Gala concluded.