UAE: Deal is aimed at boosting trade ties between the two countries

The UAE and South Korea have signed a Comprehensive Economic Partnership Agreement aimed at strengthening economic and trade co-operation between the countries.

This deal was signed on Wednesday during the visit of President Sheikh Mohamed to Seoul, where he met South Korean President Yoon Suk Yeol.

The leaders held “constructive discussions on strengthening bilateral ties”, Sheikh Mohamed said on X.

“Together, we witnessed the signing of numerous MoUs [memorandum of understandings] and the Comprehensive Economic Partnership Agreement between the UAE and the Republic of Korea,” he said.

“Today’s signing represents a promising step forward as we commit to building upon the robust economic co-operation that links our nations and delivering tangible growth for our peoples.”

I was pleased to meet @President_KR Yoon Suk Yeol in Seoul and engage in constructive discussions on strengthening bilateral ties. Together, we witnessed the signing of numerous MoUs and the Comprehensive Economic Partnership Agreement between the UAE and Republic of Korea.… pic.twitter.com/LY1j1dKryZ

— محمد بن زايد (@MohamedBinZayed) May 29, 2024

The latest deal is expected to contribute 1.17 per cent to the UAE’s gross domestic product by 2032 and 2.37 per cent to South Korea’s GDP during the same period, according to a government statement.

The UAE and South Korea concluded negotiations for the Cepa in October, with the deal aimed at reinforcing East-West supply chains and enabling two-way foreign direct investment flows, state news agency Wam reported at the time.

Wednesday’s agreement will also improve joint research and knowledge exchange across sectors including energy, advanced manufacturing, technology, food security and health care, it said.

The Cepa with South Korea, “which follows a series of MoUs on industrial and technological collaboration signed in January 2023, will enable our businesses, investors and entrepreneurs to engage with their counterparts, share knowledge and insights and drive a new era of growth based on innovation and creativity,” said Dr Sultan Al Jaber, Minister of Industry and Advanced Technology.

This comes as the Arab world’s second-largest economy continues to strengthen trade ties with countries around the globe.

With this latest announcement, UAE has signed 10 Cepas. It has also agreed on deals with India, Turkey, Israel, Indonesia, Cambodia, Georgia, Ukraine, Colombia and Costa Rica.

The country is also currently holding talks to conclude new deals with Serbia, Vietnam, the Philippines, New Zealand and Ecuador and others.

The UAE is working towards signing 26 Cepas as it seeks to attract more investment and diversify its economy.

“Under the terms of the agreement, companies and investors from both sides will benefit from the elimination of almost all tariffs, the removal of trade barriers in vital sectors, including energy and resources, health care, advanced industries, smart farms and bio-economy, in addition to greater access to markets in the fast-growing regions of the Middle East and Asia,” the statement said.

Non-oil bilateral trade between the UAE and South Korea reached $5.3 billion last year.

The Emirates is currently South Korea’s second-largest trade partner in the Arab World, accounting for 20 per cent of trade with the region.

South Korea’s investments in the UAE rose to $2.2 billion while the UAE’s investments in Korea stood at $578 million by the end of 2022, according to Wam.

Last year, all four units of the $20 billion Barakah power plant in Abu Dhabi, built by the Korea Electric Power Corporation in a consortium that featured Hyundai, Samsung, Korea Hydro and Nuclear Power, and Doosan Heavy Industries and Construction, became operational, with the capability of meeting up to 25 per cent of the UAE’s electricity needs.

The UAE is already Korea’s second-largest Arab trading partner, with bilateral non-oil trade reaching $5.3 billion in 2023. This agreement will help pave the way for new milestones as we make trade easier, smarter and more resilient. We’re ready to embrace an exciting new era.

— د. ثاني أحمد الزيودي (@ThaniAlZeyoudi) May 29, 2024

The new deal will “create market opportunities for our exporters and manufacturers, and enable our logistics companies, freight-forwarders and wholesalers to play an increasingly central role in the global trade”, Dr Thani Al Zeyoudi, Minister of State for Foreign Trade, said.

“We also see the expansion of Korean investment into the UAE as we become an important gateway for its products into the high-potential markets of the Middle East and Africa.”

The UAE seeks to boost non-oil foreign trade to more than Dh4 trillion ($1 trillion) by 2031 amid new trade agreements with various countries and economic diversification plans.

The country’s non-oil foreign trade hit a record Dh3.5 trillion in 2023, up from Dh2.23 trillion in 2022, as trade with its top 10 most important foreign partners grew by 26 per cent last year.

“The UAE-[South] Korea Comprehensive Economic Partnership Agreement will create a wealth of opportunities for our private sector, from accelerated trade flows to investment and economic projects in key sectors such as new economy, logistics, transport, advanced technology and renewable energy,” said Minister of Economy Abdulla bin Touq.

Meanwhile, the Dubai Multi Commodities Centre signed an initial agreement with the Seoul Business Agency to support start-ups and boost innovation between the UAE and South Korea.

The partnership will focus on the expansion of South Korean start-ups in the UAE through dedicated acceleration programmes, DMCC said on Wednesday.

“Through dedicated acceleration programmes and the pooling of knowledge and other resources, our strategic partnership … will provide vital support for start-ups and entrepreneurs from South Korea looking to grow from Dubai,” said Ahmed bin Sulayem, executive chairman and chief executive of DMCC.

Source: https://www.thenationalnews.com/business/economy/2024/05/29/uae-and-south-korea-sign-cepa-during-president-sheikh-mohameds-visit/

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