Analysis of trade and GDP data suggests that two main factors explain which countries trade with the UK: geographical distance and GDP per capita.



The UK exports relatively more to Gulf countries such as the United Arab Emirates (UAE), Qatar and Kuwait, which have high per capita incomes and are closer to the UK than Southeast and Northeast Asian countries . Countries such as Nigeria, Kenya and India have higher imports from the UK than suggested by their income levels. Cultural ties with the UK could be a factor, as they are all part of the Commonwealth of Nations.



Focusing on raising UK exports to EM countries with high GDP per capita could bear fruit. This group of countries is gradually beginning to demand more high-value-added goods such as quality motor vehicles and pharmaceuticals, rather than raw materials such as commodities.



In addition, as incomes rise, services demand is likely to grow in relation to goods consumption. Financial services, insurance and entertainment (e.g., broadcasting rights for television programmes) are are likely to be most in demand.



"We expect UK exports to markets such as China to continue to increase as China's GDP per capita reaches middle-income levels and China shifts towards consumption and away from investment-led growth", says Standard Chartered.