Other Briefings2025 Outlook: Expanding UAE CEPA Network to Drive Economic Growth
The UAE will continue to expand its global trade network through CEPA deals in 2025 as it chases a US$1-trillion target for non-oil trade by 2031.
By Melissa Cyrill
The United Arab Emirates (UAE) has emerged as a global hub for commerce and investment through its Comprehensive Economic Partnership Agreement (CEPA) program. These CEPA agreements, spearheaded by Dr. Thani bin Ahmed Al Zeyoudi, Minister of State for Foreign Trade, aim to foster international trade relationships, enhance economic growth, and cement the UAE’s position in the global marketplace. In 2025, the UAE plans to extend its CEPA network further, unlocking new opportunities for businesses worldwide.
Countries with which the UAE government is pursuing negotiations or has signed initial CEPA frameworks with include Australia, Vietnam, Jordan, Malaysia, the Philippines, and the South American Mercosur bloc.
The UAE has entered into 24 CEPAs since the program’s inception over three years ago, impacting approximately 2.5 billion people worldwide. The initiative seeks to boost the UAE’s non-oil trade to US$1 trillion by 2031 while aiming to double its economy to exceed US$800 billion by 2030. – AGBI
The vision behind UAE’s CEPA program
Dr. Al Zeyoudi has articulated the strategic importance of CEPAs in promoting rules-based international trade, sustainable development, and economic inclusivity. By establishing partnerships across continents, the UAE positions itself as a critical gateway for non-oil trade, services, and re-exporting activities. “These agreements reflect the UAE’s vision, which recognizes the vital role of free trade based on clear rules in driving sustainable economic growth and inclusive development,” said Dr. Al Zeyoudi.
The diversity of these agreements indicates the UAE’s ability to form impactful collaborations across five continents, opening new markets for various industries and sectors. By leveraging CEPAs, the UAE has enhanced its capabilities in logistics, clean energy, advanced materials, and sustainable food systems, among others.
Tangible economic impact
Since the inception of the CEPA program in September 2021, the UAE has signed 24 agreements, covering 2.5 billion people globally—approximately a quarter of the world’s population. This has contributed to significant growth in non-oil trade and foreign investment.
In the first half of 2024, the UAE’s foreign trade surpassed AED 1.395 trillion, reflecting an 11.2 percent increase compared to the same period in 2023. Over a longer horizon, growth rates were 28.8 percent, 54.7 percent, and 66 percent compared to the same periods in 2022, 2021, and 2019, respectively. These figures underscore the transformative impact of CEPAs in driving the UAE’s trade ambitions.
The UAE intends its CEPA program to increase the country’s non-oil foreign trade to AED4 trillion (US$1 trillion) by 2031.
Benefits for UAE exporters
UAE exporters are among the primary beneficiaries of CEPAs, enjoying enhanced market access and preferential tariff rates. Certain products benefit from zero tariffs immediately upon the agreement’s implementation, while others see phased tariff reductions over time. Businesses can utilize the UAE’s market access dashboard to determine their products’ HS codes and estimate tariff advantages. This streamlined approach simplifies trade and encourages greater participation in international markets.
Key UAE CEPA agreements in action
The UAE has forged impactful CEPAs with multiple nations, each tailored to unlock mutual benefits:
UAE-India CEPA
The UAE-India CEPA, effective May 1, 2022, has significantly boosted trade by eliminating tariffs on over 80 percent of products. This agreement provides UAE businesses with access to Indian government procurement opportunities and ensures a non-discriminatory trade environment. Notably, it addresses technical barriers to trade and establishes a Joint Committee to review and enhance market access.
UAE-Indonesia CEPA
Signed on July 1, 2022, and effective September 1, 2023, the UAE-Indonesia CEPA enhances market access for UAE products, covering over 90 percent of tariff lines and 94 percent of trade value. It also includes a 10 percent price preference for UAE businesses in Indonesian government procurement tenders, promoting robust bilateral trade and investment.
UAE-Israel CEPA
The UAE-Israel CEPA, effective April 1, 2023, covers 96 percent of tariff lines and 99 percent of trade value. It facilitates digital trade, enhances service sector collaboration, and provides UAE service suppliers with access to Israel’s domestic markets. This agreement is pivotal in driving innovation and strengthening trade ties.
UAE-Türkiye CEPA
Effective September 1, 2023, the UAE-Türkiye CEPA encompasses 83 percent of tariff lines and 93 percent of trade value. The agreement simplifies customs procedures, promotes bilateral investment, and removes technical barriers to trade. This partnership further strengthens the UAE’s role as a trade leader in the Middle East.
UAE-Cambodia CEPA
Effective January 31, 2024, the UAE-Cambodia CEPA offers extensive market expansion opportunities, covering over 92 percent of tariff lines. It empowers SMEs, facilitates investment, and simplifies customs procedures, fostering economic growth and technological advancement.
UAE-Georgia CEPA
Signed on October 10, 2023, and effective June 27, 2024, the UAE-Georgia CEPA provides access to over 92 percent of tariff lines. This agreement emphasizes SME empowerment, investment opportunities, and collaboration in sectors such as healthcare, education, and tourism.
Prospects going into 2025
Looking ahead, the UAE’s strategy involves signing additional CEPAs with strategic partners in 2025. This aligns with the nation’s “Projects of the 50” initiative, which seeks to propel sustainable development and economic diversification. As more trade facilitation agreements come into force, UAE businesses can expect broader market access, simplified trade processes, and enhanced opportunities in emerging sectors such as green industries, advanced technology, and digital trade.
Conclusion
The UAE’s ambitious CEPA program reflects its commitment to strengthening global trade partnerships and fostering economic growth. By expanding its network of agreements, the UAE is focused on maintaining economic resilience while also managing for inclusive and sustainable development amid increasingly volatile geopolitical conditions. Businesses and investors should capitalize on these CEPA agreements to unlock new opportunities and participate in the UAE’s journey as a global trade powerhouse.
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