U.K. Pledges Millions of Pounds in Economic Support and Abolishes Double Taxation During President Santos’ First Trip to London
In the wake of the nation’s peace deal being rejected by voters, Colombian President Juan Manuel Santos made his first official state visit to the United Kingdom. While staying in Buckingham Palace for three days, he sat down with Prime Minister Theresa May and received commitments of millions of pounds in economic development from his U.K. counterpart while discussing the ongoing peace negotiations with guerrillas, bilateral trade, and collaborating to combat crime.
May said that the United Kingdom was committed to strengthening the trade relationship between the two nations, which was worth 1 billion pounds in 2015 and she believes is set to grow even further due to three major initiatives.
“Today we are supporting those efforts with a new partnership in the oil and gas sector, 1 billion pounds in export finance to encourage investment in rural healthcare and renewable energy projects, and a landmark tax agreement to provide greater certainty for businesses and employees in both countries,” said May.
Photo: Colombian President Juan Manuel Santos made his first official state visit to London this week and was welcomed with economic and diplomat support by U.K. Prime Minister Theresa May. (Photo Credit: Presedencia de la República, Juan Pablo Bello – SIG)
The double tax agreement centers on preventing companies from being burdened by “double taxation” in which their profits are hit by both governments. It also seeks to add clarity to companies and employees operating between the UK and Colombia over which taxes must be paid to which jurisdictions.
The deal also will help the two governments work together to fight tax evasion and avoidance. Santos said that he will continue rooting out corruption, strengthening the rule of law, and improving the business environment in order to attract more investment from U.K. companies. “We have signed this morning an agreement to prevent double taxation, that will benefit thousands of companies and individuals doing business in both countries,” said President Santos. He added that, “joint action against organized crime, including co-operation in cybersecurity and improving the effectiveness of our criminal justice policy, will be a key priority in our common agenda.”
During her comments, May pledged an an investment of up to 25 million pounds in urban development, agriculture, services, and transport, something she says will help more than three million people impacted by Colombia’s half-century conflict and create export opportunities worth upwards of 6 billion pounds for some 2,500 British businesses.
In terms of progress already made, May highlighted the opening of a Lloyd’s of London office in Bogotá this summer, which will add an estimated 130 million pounds of revenue to the insurance industry in the United Kingdom. May, a conservative who took over as prime minister after David Cameron resigned following his party’s Brexit vote loss, noted that the United Kingdom has been the third largest foreign investor in Colombia in the past decade and that the arrival of Lloyd’s is a good example of how England should be fostering even more trade with Colombia.
“Today, we have agreed that we want to build on this solid base,” said May. “As the U.K. prepares to leave the EU, I am determined that Britain should become the global champion of free trade, and that means boosting trade with fast-growing economies like Colombia.”
For Santos, insurance is but one sector ripe for further development. An ocean has kept the two countries from being larger economic allies in the past, but he thinks this can be overcome in a time when borders and distance matter less. “Quite frankly, the trade figures are very small compared to what they could be, so we see this as a great opportunity to enlarge our trade, and to make even a more ambitious agreement, and to attract more investment both ways,” said President Santos. “We were talking, for example, about the financial sector, the insurance sector: the potential to grow in Colombia is immense.”
May agreed and said that she hopes this investment and business momentum can go both ways. “I want to see even more British companies and investors taking up the opportunities that Colombia offers,” said May. “And I want Colombian businesses to see the UK as a leading hub for finance, innovation, research and development … Colombia is one of Britain’s most important partners in Latin America, and this visit provides an opportunity to strengthen the ties that have existed between our countries for more than 200 years.”
Lastly, the U.K. prime minister announced that her nation will contribute an additional 7.5 million pounds to de-mining efforts and the international monitoring mission in Colombia. The country will also continue to offer advice from its experts who went through their own peace process with Northern Ireland. “We know from our own experiences that peace-building takes time, perseverance and patience.”