Ukraine and the United Arab Emirates (UAE) have signed a Comprehensive Economic Partnership Agreement. This was announced by the Office of the President of Ukraine.
The document significantly liberalizes access to the UAE market for nearly all Ukrainian goods. Additionally, it covers services, investments, and digital trade. This marks the first agreement of its kind between Ukraine and a Gulf country.
The signing took place on February 17 in Abu Dhabi, with the participation of Ukrainian President Volodymyr Zelensky. The document was signed on behalf of Ukraine by the First Deputy Prime Minister and Minister of Economy, Yulia Svyrydenko, and on behalf of the UAE by the Minister of State for Foreign Trade, Thani bin Ahmed Al Zeyoudi.
Ukrainian goods will gain full access to the UAE market for 96.6% of product lines, as reported by the Ministry of Economy of Ukraine.
"This is a historic event, as it concerns the first agreement in the most economically advanced region of the Middle East. It encompasses not only the UAE but the Gulf region as a whole. This is not just an agreement between two countries; it is a gateway to the global market, as the UAE serves as an important economic, trade, and financial hub in the Middle East. The implementation of this Agreement, which covers practically the entire nomenclature of bilateral trade, will enable an increase in production and export of Ukrainian products by removing tariff barriers in trade between the two countries," emphasized Yulia Svyrydenko.
According to estimates from the Ministry of Economy, the agreement may help maintain a positive trade balance in goods, which amounted to $51.5 million in 2023. In the medium to long term, it could influence a shift in the trajectory of real GDP development by 0.1%.
The agreement covers not only trade in goods but also services, investments, and the digital economy. Ukrainian companies will receive:
- streamlined access to the UAE markets and other countries in the region;
- predictable trading conditions;
- removal of barriers to export and investment.
Growth in Ukrainian exports is expected in key sectors: metallurgy, food industry, particularly flour milling, and oil production. There is also a forecasted increase in the export of metals and vegetable oil.
According to Yulia Svyrydenko, the Agreement is mutually beneficial for both countries. Ukraine and the UAE are competitive in various sectors, thus they can complement each other's trade flows and strengthen their economies.
The parties also agreed to establish the Ukraine-UAE Investment Council, which will facilitate increased capital investments and the removal of barriers for business. Additionally, a Committee on Small and Medium Enterprises will be established to support entrepreneurs through training and consulting.
The UAE has lifted the 49% foreign capital share restriction for Ukraine, allowing entrepreneurs to register companies with foreign capital up to 70%, and in certain sectors, gradually up to 100% (including in commercial services, construction, education, healthcare, and accounting). Meanwhile, in free economic zones, Ukrainian companies will be able to own 100% of the business, which is a significant step for the development of Ukrainian business in this region.
The agreement opens new opportunities for digital trade: tariffs on digital and electronic data transmission, including electronic content, have been abolished. Commitments regarding digital payments, personal data protection, and the establishment of transparent rules for businesses that develop the digital economy and cross-border trade have been secured.
In the first 11 months of 2024, trade between Ukraine and the UAE amounted to $415 million. Ukraine's exports to the UAE totaled $266.8 million, while imports reached $148.2 million.
Ukraine and the UAE have signed a free trade agreement