(MENAFN- Khaleej Times)
The UAE and Australia have reached the Comprehensive Economic Partnership Agreement (CEPA), which will result in savings of hundreds of millions of dirhams for traders of both the countries.
“This trade agreement provides a gateway for Australian exporters to diversify into the Middle East, a market of around 58 million consumers and a combined GDP of A$1.4 trillion (Dh3.46 trillion)... The new trade agreement is a great deal for Australian exporters. Over 99 per cent of Australian products will enter the UAE tariff-free, resulting in estimated tariff savings of $135 million in the first year, rising to $160 million per year once the agreement is fully implemented,” Australia's Trade and Tourism Ministry said on Tuesday.
The UAE has already signed CEPA with major trading partners such as India, Israel, Chile, Colombia, Turkey, Indonesia, Georgia and Cambodia.
The Emirates has been aggressively pursuing a Comprehensive Economic Partnership Agreement with trading partners to boost non-oil trade to Dh4 trillion by 2031. The UAE's non-oil trade reached Dh1.4 trillion in the first half of 2024, rising by 11.2 per cent year-on-year.
The UAE is Australia's largest trade and investment partner in the Middle East with two-way trade worth $9.9 billion in 2023. Two-way investment between Australia and the UAE totalled $20.6 billion in 2023, and this is expected to increase significantly.
The two countries are working to formalise the legal treaty text in preparation for signing later this year, said the statement.
The agreement will deliver real benefits for Australian farmers and food producers, with estimated tariff savings of $50 million per year.
Key Australian exports to the UAE include alumina, meat, dairy, oil seeds, seafood, steel, canola seeds, nuts, honey, coal, chickpeas, lentils and higher education.
The Australian mining industry will also benefit from tariff cuts on exports, including alumina which was valued at $1 billion in 2023.
The agreement cuts Australian import tariffs on UAE-produced furniture, copper wire, glass containers and plastic, making them cheaper at the checkout and lowering business costs. It is estimated that Australian households and businesses will save around $40 million a year.
“A trade agreement with the UAE will facilitate investment, which is important to achieving the Albanese Government's ambition of becoming a renewable energy superpower. Under this trade agreement, Aussie exports are expected to increase by $678 million per year, but this deal means more for Australia than just numbers. More trade means more higher-paying jobs, more opportunities for our businesses, greater investment to build things here in Australia, and cheaper bills for Australian households,” said Don Farrell, Australia's minister for trade and tourism.
Don Farrell (Photo: Supplied)
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