The United Arab Emirates (UAE) and South Korea have successfully concluded negotiations for a Comprehensive Economic Partnership Agreement (CEPA), marking a significant milestone in their growing trade and investment relationship.
This announcement comes as bilateral non-oil trade between the two nations reached $3 billion during the first half of 2023, representing a 21% increase over the same period in 2021.
One of the notable collaborative achievements between the UAE and South Korea is the construction of the Barakah Power Plant in Abu Dhabi, a $20 billion nuclear project.
The Korea Electric Power Corporation and a consortium of Korean companies played a pivotal role in building all four units of the plant, which began operating in April of this year.
This development has greatly contributed to meeting the UAE’s domestic electricity requirements.
The journey towards a CEPA between these two nations began in 2021, reflecting their mutual interest in fostering closer economic ties.
However, three months later, South Korea also rekindled discussions regarding a Free Trade Agreement (FTA) with the Gulf Cooperation Council (GCC), a regional bloc of which the UAE is a member.
Thani Al Zeyoudi, the UAE’s Minister of Foreign Trade, expressed the eagerness of both nations to finalize the CEPA, emphasizing that FTA discussions with the GCC remain ongoing.
This agreement is expected to benefit the 178 South Korean companies already conducting business in the UAE as of 2022.
It will enhance the stability of their operations in the UAE and bolster South Korean firms’ engagement in the Middle East and North Africa.
The UAE has been actively pursuing CEPA agreements with various countries, including Israel, Turkey, India, and Indonesia, as part of its strategy to diversify its economy away from oil dependency.
Notably, the UAE has stressed its commitment to separating politics from trade, even when faced with conflicts such as the Israel-Gaza conflict, indicating a steadfast dedication to economic cooperation and growth.
In conclusion, the successful conclusion of CEPA negotiations between the UAE and South Korea highlights their commitment to expanding economic cooperation.
This partnership is expected to boost trade, strengthen business ties, and promote economic growth for both nations while solidifying their positions as key players in the global economy.