The United Arab Emirates (UAE) is entering a new era of economic collaboration with two rapidly growing global players as it activates two of its Comprehensive Economic Partnership Agreements (CEPAs). The UAE-Türkiye CEPA and the UAE-Indonesia CEPA have officially come into force, setting the stage for enhanced trade and investment cooperation.

The primary goal of these CEPAs is to foster economic ties by doubling non-oil trade. The UAE-Türkiye CEPA aims to elevate bilateral non-oil trade to an impressive $40 billion within five years, while the UAE’s CEPA with Indonesia seeks to push non-oil trade beyond $10 billion within the same timeframe. These agreements also aim to facilitate investment projects valued at $10 billion in various sectors.

In the words of HE Al-Zeyoudi, “The implementation of our CEPAs with Türkiye and Indonesia marks a significant step forward in our foreign trade program. Both agreements will unlock significant opportunities for our private sector in two of the world’s most dynamic centers of growth.”

These CEPAs are the third and fourth of their kind to come into force for the UAE, following successful agreements with India in May 2022 and Israel in April 2023. They are a testament to the UAE’s foreign trade agenda, strategically forging robust economic connections with nations of global importance. Both CEPAs promise to reduce or remove tariffs on a wide range of goods, eliminate trade barriers, and create pathways for investments in vital sectors like logistics, energy, food production, fintech, e-commerce, and travel and tourism.

The UAE-Indonesia CEPA, inked in Abu Dhabi in July 2022, aims to significantly boost bilateral non-oil trade from $4.08 billion to over $10 billion within five years. Additionally, the agreement targets a combined trade in services worth $630 million by 2030. Notably, over 80 percent of UAE exports to Indonesia will now be exempt from customs duties under this pact. This partnership also has an eye on nurturing the rapidly expanding Islamic economy, projected to reach $3.2 trillion by 2024. It will accelerate investment projects worth $10 billion across sectors like agriculture, energy, infrastructure, and logistics. The UAE-Türkiye CEPA is equally impactful, having eliminated or reduced customs duties on 82 percent of product lines, accounting for more than 93 percent of bilateral non-oil trade. Türkiye was the UAE’s fastest-growing top ten trading partner in 2022, witnessing a 40 percent increase in non-oil trade to $18.9 billion. The newly liberalized trade environment is set to drive this figure to an impressive $40 billion within the next five years.

HE Al Zeyoudi also stressed that the Comprehensive Economic Partnership Agreements play a vital role in attaining the nation’s objectives, in particular the vision laid out in “We The UAE 2031”, which seeks to double the UAE’s non-oil foreign trade to AED4 trillion and elevate national exports to AED800 billion. The recently published statistics from H1, 2023, which show a record non-oil foreign trade value of AED1.239 trillion for the first six months of the year, demonstrate that the UAE is firmly on track – and that the CEPA program will help maintain this upward trajectory.

The G20 Trade and Investment Ministerial Meeting (TIMM) was held in Jaipur, India, and Dr. Thani bin Ahmed Al Zeyoudi, the UAE’s Minister of State for Foreign Trade, attended.

He presented ideas with ministers and trade officials to improve international commerce and make sure it keeps fostering long-term economic progress for all countries.

Before the Leaders’ Summit in New Delhi in September, this was the last G20 trade and investment ministers meeting.

It adopted the key resolutions developed during the year by the trade and investment working group, which centered on five priority issues: Trade for Growth & Prosperity; Resilient Trade and Global Value Chains (GVCs); Integrating MSMEs into World Trade; Logistics for Trade; and World Trade Organization (WTO) Reform.

The outcomes of the TIMM will be presented to the Leaders’ Summit on September 9-10.

The UAE participated in the latest meeting as an invited guest of India under its presidency to contribute to the G20 forum. The invitation reflects the UAE’s growing importance as a trade partner to the world’s leading economies.

In 2022, non-oil trade between the UAE and G20 countries exceeded $341 billion, representing 55 per cent of the UAE’s total non-oil trade.

These figures reflect a growth of 21 per cent compared to 2021. The G20 accounts for 38 per cent of the UAE’s export revenue, while 67 per cent of the UAE’s merchandise imports come from G20 member countries.

President Sheikh Mohamed bin Zayed Al Nahyan has shown his appreciation on the UAE being included as a member of BRICS and described it as an “important group”.

Taking to his social media platform X, Sheikh Mohamed said he “respected the vision of the BRICS leadership. We look forward to a continued commitment of cooperation for the prosperity, dignity and benefit of all nations and people around the world,” he wrote.

Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, added that the decision is a reflection of the country’s remarkable leadership and successful international policy.

 

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الموافقة على انضمام دولة الإمارات لمجموعة البريكس اليوم يمثل نجاحاً لسياستها الدولية المتوازنة بقيادة أخي صاحب السمو الشيخ محمد بن زايد رئيس الدولة حفظه الله..
كما يمثل انضمام الدولة لهذه المجموعة امتداداً لفلسفتها القائمة على بناء شراكات دولية ايجابية متعددة الأطراف، ويرسخ…

— HH Sheikh Mohammed (@HHShkMohd) August 24, 2023

“It also consolidates the UAE’s international economic and trade position as a reliable partner linking the world’s north with its south and east with west,” he wrote. As part of the first phase of expansion, Argentina, Egypt, Ethiopia, Iran, Saudi Arabia and UAE have been invited to join BRICS.

They will be formally admitted as members on January 1, 2024. The BRICS group of nations currently comprises Brazil, Russia, India, China and South Africa. The new candidate members were announced by South African President Cyril Ramaphosa, who is hosting the 15th summit of BRICS in Johannesburg.

“As five BRICS countries, we have reached an agreement on the guiding principles, standards, criteria, and procedures on the BRICS expansion process which has been in discussion for quite a while,” Ramaphosa told a joint media briefing.

“We have consensus on the first phase of this expansion process and other phases will follow.”
Sheikh Saud bin Saqr Al Qasimi, UAE Supreme Council Member and Ruler of Ras Al Khaimah, was one of nearly 50 leaders who attended the main session of the BRICS summit.

Sheikh Saud expressed confidence in the strength of the UAE’s economy and global influence. The inclusion in BRICS reflects the nation’s steadfast approach to enhancing co-operation with various countries worldwide, he said.

Sheikh Saud further highlighted that the UAE has always been an advocate of the principles underpinning BRICS’ objectives and has played a significant role in supporting its international agenda. “We recognise the expansion of BRICS as an important opportunity to create a multilateral leadership model that nurtures and enriches the principles of inclusivity, tolerance and mutual respect, particularly within the region of the Global South,” he added.

He pointed out that the UAE is among the prominent trade and investment partners of BRICS, with non-oil trade between the UAE and member nations reaching $677 billion. Additionally, investment flows amounted to $38 billion between 2018 and 2022.