UK-Arctic Trade and Investment Observatory

By Dr Dwayne Ryan Menezes
Greenwich Park, with the City of London in the background.

Project Lead: Dr Dwayne Ryan Menezes

Project Team: Mikhail Radkevitch, Helena Roberts, Shaan Afzal-Khan, Haroon Faqir, Joe Godbold


First published: 18 February 2021
Last updated: 15 March 2022

On the occasion of its fifth anniversary since its establishment, Polar Research and Policy Initiative (PRPI) is pleased to join forces with the London-based investment advisory firm High North Advisers (HNA) to launch the UK-Arctic Trade and Investment Observatory, a one-stop shop to find the latest statistics, analysis and commentary about the UK’s trade and investment relationships across the Arctic, Nordic and North Atlantic regions. The PRPI-HNA Observatory is to be a permanent and regularly updated feature that builds on PRPI’s expertise and experience in trade and investment policy and promotion, and HNA’s background in providing investment advisory services, to showcase and strengthen the bilateral trade and investment relationships between the UK and its Northern partners: the US, Canada, Norway, Sweden, Finland, Denmark, Greenland, Faroe Islands, Iceland and Russia. 

The PRPI-HNA Observatory gleans the most relevant data from the UK Department of International Trade (DIT)’s Trade and Investment Factsheets that were released, for the first time, on 12 February 2021, and that provide valuable insights into the UK’s trade and investment relationships with its Arctic, Nordic and North Atlantic trading partners overseas. Over the coming months, the Observatory will be updated every time new data becomes available or there is a significant new development, and as and when PRPI publishes analysis and commentary about these trading relationships. In the case of Greenland and Faroe Islands, there may be discrepancies between the data in the DIT factsheets and the data in PRPI’s reports due to the different assumptions and methodologies used – for instance, what percentage of Greenland’s exports to the UK entering from Denmark is treated in the UK as imports from Greenland versus imports from Denmark? Any PRPI reports about Greenland or Faroe Islands would include, as far as possible, all imports into the UK of products originating in Greenland or the Faroe Islands (even if entering via Denmark) within the statistics for UK-Greenland trade or UK-Faroes trade, as opposed to UK-Denmark trade.

As evident in the overview provided below, the Arctic and Nordic states are highly important to the UK both as export markets and import sources. 6 of the 8 Arctic Council member states feature among the UK’s 25 largest trading partners: USA (1st), Norway (13th), Sweden (16th), Canada (17th), Russia (19th), Denmark (24th), Finland (37th) and Iceland (74th). They constitute some of the UK’s biggest export markets – USA (1st), Canada (13th), Sweden (15th), Norway (17th), Denmark (23rd), Russia (26th), Finland (39th) and Iceland (79th) – and leading import sources – USA (1st), Norway (10th), Sweden (16th), Russia (15th), Denmark (21st), Canada (21st), Finland (38th) and Iceland (65th). Yearly fluctuations aside, the UK and the US, furthermore, have the strongest bilateral investment relationship in the world, with two-way direct investment amounts to more than USD 1 trillion. UK companies in the US employ more than 1.2 million Americans, while US companies in the UK employ more than 1.5 million Britons. Provided below are the statistics for the UK’s trade with each Arctic and Nordic country.

Mainly due to its strategic geographic location, but also through its historical, cultural and economic ties, the UK sits at the heart of the Northern Arc of Prosperity spanning the Arctic, Nordic and North Atlantic regions. As the UK embraces its future as an independent trading nation, there has never been a more opportune time for it to look North in a more concerted fashion and position itself as a strategic gateway between its Northern neighbourhood and the world beyond. For its Arctic, Nordic and North Atlantic partners, the UK offers access not just to the world’s financial capital, but also to numerous world-leading centres/clusters of expertise, innovation, influence and capital, and is best placed to serve as both an attractive market and a crucial stepping stone for companies seeking to scale up and internationalise. The PRPI-HNA Observatory aims to serve as a valuable resource for stakeholders seeking to understand, monitor and advance the two-way flow of goods, services and capital between the UK and its Northern neighbours.


USA

Seward Harbour, Alaska Seward Harbour, Alaska © Srini Sundarrajan/Flickr

Period: Four quarters to the end of Q3 2021 (unless specified otherwise)

  • Rank as trading partner (goods and services):
    • Largest trading partner (accounting for 16.7% of total UK trade)
    • 2nd largest goods trading partner (accounting for 10.9% of UK goods trade)
    • Largest services trading partner (accounting for 26.8% of UK services trade)
  • Rank as export market:
    • Largest export market (accounting for 21.4% of total UK exports)
    • Largest goods export market (accounting for 15% of UK goods exports)
    • Largest services export market (accounting for 28.1% of UK services exports)
  • Rank of import market:
    • Largest import market (accounting for 12.3% of total UK imports)
    • 4th largest goods import market (accounting for 8.2% of UK goods imports)
    • Largest services import market (accounting for 24.5% of UK services imports)
  • Total trade in goods and services: £210.1 billion (decrease of 1.0% or £2.1 billion from previous year)
  • Total UK exports to USA: £130.7 billion (decrease of 3.3% or £4.5 billion from previous year)
  • Total UK imports from USA: £79.3 billion (increase of 3.2% or £2.4 billion from previous year)
  • Outward stock of FDI (2020): £399.9 billion (24.1% of the total UK outward FDI stock)
  • Inward stock of FDI (2020): £479.2 billion (24.8% of the total UK inward FDI stock)

Canada

Vancouver, Canada Vancouver, Canada © Jerry Meaden/Flickr

Period: Four quarters to the end of Q3 2021 (unless specified otherwise)

  • Rank as trading partner (goods and services):
    • 14th trading partner (accounting for 1.8% of total UK trade)
    • 15th largest goods trading partner (accounting for 1.8% of UK goods trade)
    • 16th largest services trading partner (accounting for 1.7% of UK services trade)
  • Rank as export market:
    • 13th largest export market (accounting for 2.0% of total UK exports)
    • 13th largest goods export market (accounting for 1.9% of UK goods exports)
    • 10th largest services export market (accounting for 2.0% of UK services exports)
  • Rank of import market:
    • 19th largest import market (accounting for 1.6% of total UK imports)
    • 16th largest goods import market (accounting for 1.6% of UK goods imports)
    • 18th largest services import market (accounting for 1.3% of UK services imports)
  • Total trade in goods and services: £22.0 billion (increase of 20.5% or £3.8 billion from previous year)
  • Total UK exports to Canada: £12.0 billion (increase of 0.2% or £23 million from previous year)
  • Total UK imports from Canada: £10.1 billion (increase of 58.9% or £3.7 billion from previous year)
  • Outward stock of FDI (2020): £29.6 billion (1.8% of the total UK outward FDI stock)
  • Inward stock of FDI (2020): £40.7 billion (2.1% of the total UK inward FDI stock)

Period: Four quarters to the end of Q3 2021 (unless specified otherwise)

  • Rank as trading partner (goods and services):
    • 11th largest trading partner (accounting for 2.2% of total UK trade)
    • 10th largest goods trading partner (accounting for 2.9% of UK goods trade)
    • 23rd largest services trading partner (accounting for 1.1% of UK services trade)
  • Rank as export market:
    • 22nd largest export market (accounting for 1.2% of total UK exports)
    • 22nd largest goods export market (accounting for 1.2% of UK goods exports)
    • 22nd largest services export market (accounting for 1.2% of UK services exports)
  • Rank of import market:
    • 9th largest import market (accounting for 3.1% of total UK imports)
    • 7th largest goods import market (accounting for 3.9% of UK goods imports)
    • 26th largest services import market (accounting for 0.8% of UK services imports)
  • Total trade in goods and services: £27.6 billion (increase of 31.2% or £6.6 billion from previous year)
  • Total UK exports to Norway: £7.3 billion (decrease of 4.8% or £367 million from previous year)
  • Total UK imports from Norway: £20.3 billion (increase of 51.9% or £6.9 billion from previous year)
  • Outward stock of FDI (2020): £5.5 billion (0.3% of the total UK outward FDI stock)
  • Inward stock of FDI (2020): £8.4 billion (0.4% of the total UK inward FDI stock)

Sweden

Stockholm, Sweden Stockholm, Sweden © Syuqor7/Flickr

Period: Four quarters to the end of Q3 2021 (unless specified otherwise)

  • Rank as trading partner (goods and services):
    • 16th largest trading partner (accounting for 1.6% of total UK trade)
    • 19th largest goods trading partner (accounting for 1.3% of UK goods trade)
    • 12th largest services trading partner (accounting for 2.0% of UK services trade)
  • Rank as export market:
    • 16th largest export market (accounting for 1.5% of total UK exports)
    • 18th largest goods export market (accounting for 1.4% of UK goods exports)
    • 18th largest services export market (accounting for 1.6% of UK services exports)
  • Rank of import market:
    • 18th largest import market (accounting for 1.7% of total UK imports)
    • 20th largest goods import market (accounting for 1.3% of UK goods imports)
    • 11th largest services import market (accounting for 2.7% of UK services imports)
  • Total trade in goods and services: £20.0 billion (increase of 5.3% or £1.0 billion from previous year)
  • Total UK exports to Sweden: £9.2 billion (decrease of 1.2% or £115 million from previous year)
  • Total UK imports from Sweden: £10.9 billion (increase of 11.6% or £1.1 billion from previous year)
  • Outward stock of FDI (2020): £32.2 billion (1.9% of the total UK outward FDI stock)
  • Inward stock of FDI (2020): £10.1 billion (0.5% of the total UK inward FDI stock)

Finland

FinlandHelsinki, Finland © Juha Riisanen/Flickr

Period: Four quarters to the end of Q3 2021 (unless specified otherwise)

  • Rank as trading partner (goods and services):
    • 36th largest trading partner (accounting for 0.4% of total UK trade)
    • 33rd largest goods trading partner (accounting for 0.5% of UK goods trade)
    • 43rd largest services trading partner (accounting for 0.3% of UK services trade)
  • Rank as export market:
    • 41st largest export market (accounting for 0.4% of total UK exports)
    • 42nd largest goods export market (accounting for 0.3% of UK goods exports)
    • 37th largest services export market (accounting for 0.4% of UK services exports)
  • Rank of import market:
    • 34th largest import market (accounting for 0.5% of total UK imports)
    • 28th largest goods import market (accounting for 0.6% of UK goods imports)
    • 51st largest services import market (accounting for 0.2% of UK services imports)
  • Total trade in goods and services: £5.5 billion (increase of 1.7% or £92 million from previous year)
  • Total UK exports to Finland: £2.2 billion (decrease of 20.1% or £556 million from previous year)
  • Total UK imports from Finland: £3.3 billion (increase of 24.8% or 648 million from previous year)
  • Outward stock of FDI (2020): £3.6 billion (0.2% of the total UK outward FDI stock)
  • Inward stock of FDI (2020): £1.3 billion (0.1% of the total UK inward FDI stock)

Denmark

Copenhagen Copenhagen, Denmark © Droz Jean-Paul/Flickr

Period: Four quarters to the end of Q3 2021 (unless specified otherwise)

  • Rank as trading partner (goods and services):
    • 24th largest trading partner (accounting for 1% of total UK trade)
    • 23rd largest goods trading partner (accounting for 1% of UK goods trade)
    • 21st largest services trading partner (accounting for 1.2% of UK services trade)
  • Rank as export market:
    • 23rd largest export market (accounting for 1.1% of total UK exports) 
    • 25th largest goods export market (accounting for 0.8% of UK goods exports)
    • 19th largest services export market (accounting for 1.3% of UK services exports)
  • Rank of import market:
    • 21st largest import market (accounting for 1% of total UK imports)
    • 21st largest goods import market (accounting for 1.1% of UK goods imports)
    • 23rd largest services import market (accounting for 1% of UK services imports) 
  • Total trade in goods and services: £13.1 billion (increase of 4.4% or £550 million from previous year) 
  • Total UK exports to Denmark: £6.4 billion (increase of 4.8% or £297 million from previous year) 
  • Total UK imports from Denmark: £6.7 billion (increase of 3.9% or £253 million from previous year) 
  • Outward stock of FDI (2019): £6.4 billion (0.4% of the total UK outward FDI stock)
  • Inward stock of FDI (2019): £7.2 billion (0.5% of the total UK inward FDI stock)

Greenland

Ilulissat Ilulissat, Greenland © Dwayne Ryan Menezes

Period: Four quarters to the end of Q3 2021 (unless specified otherwise)

  • Rank as trading partner (goods and services):
    • Joint 200th largest trading partner (accounting for <0.1% of total UK trade)
    • 191st largest goods trading partner (accounting for <0.1% of UK goods trade)
    • Joint 190th largest services trading partner (accounting for <0.1% of UK services trade)
  • Rank as export market:
    • Joint 194th largest export market (accounting for <0.1% of total UK exports)
    • Joint 191st largest goods export market (accounting for <0.1% of UK goods exports)
    • Joint 177th largest services export market (accounting for <0.1% of UK services exports)
  • Rank of import market:
    • 188th largest import market (accounting for <0.1% of total UK imports)
    • Joint 155th largest goods import market (accounting for <0.1% of UK goods imports)
    • 211th largest services import market (accounting for <0.1% of UK services imports)
  • Total trade in goods and services: £12 million (a change of less than £1 million from previous year)
  • Total UK exports to Greenland: £10 million (decrease of 16.7% or £2 million from previous year)
  • Total UK imports from Greenland: £2 million (increase of £2 million from previous year)
  • Outward stock of FDI (2019): £5 million (<0.1% of the total UK outward FDI stock)
  • Inward stock of FDI (2019): <£1 million (<0.1% of the total UK inward FDI stock)

Note: According to PRPI’s data based on submissions by companies engaged in UK-Greenland trade, the bilateral trade between the two countries is much greater. For additional information, check PRPI’s UK-Greenland trade policy brief, which has the latest data as of November 2020. An addendum to the report will be published here early in March 2021, with the latest statistics as of end-February 2021.


Faroe Islands

Torshavn, Faroe Islands Torshavn, Faroe Islands © sandrinelle/Flickr

Period: Four quarters to the end of Q3 2021 (unless specified otherwise)

  • Rank as trading partner (goods and services):
    • 80th largest trading partner (accounting for 0.1% of total UK trade)
    • 92nd largest goods trading partner (accounting for <0.1% of UK goods trade)
    • 61st largest services trading partner (accounting for 0.2% of UK services trade)
  • Rank as export market:
    • 175th largest export market (accounting for <0.1% of total UK exports)
    • Joint 140th largest goods export market (accounting for <0.1% of UK goods exports)
    • 204th largest services export market (accounting for <0.1% of UK services exports)
  • Rank of import market:
    • 59th largest import market (accounting for 0.1% of total UK imports)
    • 78th largest goods import market (accounting for <0.1% of UK goods imports)
    • 38th largest services import market (accounting for 0.4% of UK services imports)
  • Total trade in goods and services: £922 million (increase of 141.4% or £540 million from previous year)
  • Total UK exports to Faroe Islands: £21 million (decrease of 34.4% or £11 million from previous year)
  • Total UK imports from Faroe Islands: £901 million (increase of 157.4% or £551 million from previous year)
  • Outward stock of FDI (2019): <£1 million (<0.1% of the total UK outward FDI stock)
  • Inward stock of FDI (2019): £3 million (<0.1% of the total UK inward FDI stock)

Iceland

Reykjavik, Iceland Reykjavik, Iceland © krismadden/Flickr

Period: Four quarters to the end of Q3 2021 (unless specified otherwise)

  • Rank as trading partner (goods and services):
    • 77th largest trading partner (accounting for 0.1% of total UK trade)
    • 61st largest goods trading partner (0.1% of UK goods trade)
    • 98th largest services trading partner (less than 0.1% of UK services trade)
  • Rank as export market:
    • 84th largest export market (accounting for 0.1% of total UK exports)
    • 68th largest goods export market (0.1% of UK goods exports)
    • 108th largest services export market (less than 0.1% of UK services exports)
  • Rank of import market:
    • 65th largest import market (accounting for 0.1% of total UK imports)
    • Joint 62nd largest goods import market (0.1% of UK goods imports)
    • 77th largest services import market (0.1% of UK services imports)
  • Total trade in goods and services: £976 million (decrease of 17.4% or £206 million from the previous year)
    • The UK reported a total trade deficit of £172 million with Iceland (compared to £146 million from the previous year).
      • Trade in goods deficit of £124 million with Iceland (compared to £166 million from the previous year).
      • Trade in services deficit of £48 million with Iceland (compared to a surplus of £20 million from the previous year).
  • Total UK exports to Iceland: £402 million (decrease of 22.4% or £116 million from the previous year)
    • Of all UK exports to Iceland, £335 million (83.3%) were goods and £67 million (16.7%) were services.
    • UK exports of goods to Iceland increased by 18.8% or £53 million compared to the previous year.
    • UK exports of services to Iceland decreased by 71.6% or £169 million compared to the previous year.
  • Total UK imports from Iceland: £574 million (decrease of 13.6% or £90 million from the previous year)
    • Of all UK imports from Iceland, £459 million (80.0%) were goods and £115 million (20.0%) were services
    • UK imports of goods from Iceland increased by 2.5% or £11 million compared to the previous year.
    • UK imports of services from Iceland decreased by 46.8% or £101 million compared to the previous year.
  • Outward stock of FDI (2019): £56 million
  • Inward stock of FDI (2019): Not available due to data disclosure

Russia

Moscow, Russia Moscow, Russia © Harry Popoff/Flickr

Period: Four quarters to the end of Q3 2021 (unless specified otherwise)

  • Rank as trading partner (goods and services):
    • 19th largest trading partner (accounting for 1.3% of total UK trade) 
    • 17th largest goods trading partner (accounting for 1.7% of UK goods trade)
    • 33rd largest services trading partner (accounting for 0.5% of UK services trade) 
  • Rank as export market:
    • 26th largest export market (accounting for 0.7% of total UK exports)
    • 24th largest goods export market (accounting for 0.8% of UK goods exports)
    • 32nd largest services export market (accounting for 0.6% of UK services exports) 
  • Rank of import market:
    • 15th largest import market (accounting for 1.8% of total UK imports) 
    • 11th largest goods import market (accounting for 2.2% of UK goods imports)
    • 33rd largest services import market (accounting for 0.5% of UK services imports)
  • Total trade in goods and services: £15.9 billion (increase of 28.7% or £3.5 billion from previous year) 
  • Total UK exports to Russia: £4.3 billion (increase of 0.6% or £24 million from previous year) 
  • Total UK imports from Russia: £11.6 billion (increase of 43.6% or £3.5 billion from previous year)
  • Outward stock of FDI (2019): £12.3 billion (0.8% of the total UK outward FDI stock)
  • Inward stock of FDI (2019): £655 million (<0.1% of the total UK inward FDI stock)
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