UAE and Australia finalize landmark trade deal to boost exports, investments

The UAE and Australia have successfully concluded negotiations on a landmark Comprehensive Economic Partnership Agreement (CEPA), marking Australia’s first trade deal with a country in the Middle East and North Africa (MENA) region. Once ratified and implemented, this agreement is expected to significantly enhance trade and investment between the two nations.

UAE's Minister of State for Foreign Trade Dr. Thani bin Ahmed Al Zeyoudi highlighted the importance of the agreement, saying, "With strong economic, social, and cultural ties between our nations, Australia has long been a valued partner for the UAE. This CEPA will unlock significant opportunities for UAE businesses and provide Australian companies with a gateway to new markets across the MENA region."

He further emphasized the commitment to swiftly ratifying the deal and delivering its benefits.

The CEPA aims to streamline trade processes, eliminate tariffs on a wide range of goods and services, foster new investment opportunities, and encourage private-sector collaboration in key sectors.

The agreement would remove tariffs on approximately 99% of Australian products, generating an estimated A$135 million (US $91 million) in savings in its first year alone.

In 2023, the UAE became Australia's largest trade and investment partner in the Middle East, with bilateral trade reaching A$9.9 billion (US $6.7 billion). Two-way investment between the nations totaled A$20.6 billion (US $14 billion)

The partnership continues to grow, with non-oil bilateral trade hitting US$2.3 billion in the first half of 2024, representing a 10% increase compared to the same period in 2023. Currently, over 300 Australian businesses operate in the UAE across sectors including construction, financial services, agriculture, and education.

Australian Trade Minister Don Farrell expressed optimism about the agreement, stating, "Under this trade agreement, Aussie exports are expected to increase by A$678 million (US $ 458 million) per year. But this deal means more for Australia than just numbers."

The deal includes a framework for boosting Abu Dhabi's investment in Australia's critical minerals sector, while the mining industry will benefit from tariff cuts on alumina exports.

Australia's top exports to the UAE include meat, dairy, oil seeds, seafood, steel, nuts, honey, coal, chickpeas, and lentils. The agreement is expected to come into effect later this year.

The Australian Meat Industry Council has welcomed the deal, stating that it will offer farmers greater access to a vital market for Australian beef, lamb, and goat meat, providing a significant boost to the country's agricultural sector.