New Agreement Aims to Remove Trade Barriers, Boost Market Access, and Strengthen Economic Ties Between the Two Nations
The United Arab Emirates and Japan have officially commenced negotiations for a Comprehensive Economic Partnership Agreement (CEPA), marking a significant milestone in their economic relationship. Announced by UAE President Sheikh Mohamed on Wednesday, this strategic move is poised to enhance trade and foster economic growth between the two countries.
The CEPA talks reflect a deep-seated commitment to elevate bilateral relations to new heights of cooperation. According to President Sheikh Mohamed, the agreement will facilitate investment, support innovation, and play a crucial role in the UAE’s efforts to diversify its economy. It aims to remove unnecessary trade barriers and improve market access for services by eliminating or reducing customs duties, thus opening new avenues for collaboration between the business communities of both nations.
Japanese Prime Minister Fumio Kishida also emphasized the importance of the CEPA negotiations in a statement on social media platform X. He highlighted the expected benefits of concluding an ambitious and balanced agreement, which, alongside the Japan-GCC Free Trade Agreement, will further strengthen economic ties and collaboration across various fields.
The UAE’s push for the CEPA is part of a broader strategy to expand its network of trade partners. Launched in September 2021, the UAE’s CEPA drive aims to achieve sustainable economic growth by enhancing trade relations and reducing trade barriers. This initiative has been instrumental in boosting non-oil foreign trade, which reached a record Dh1.395 trillion in the first half of 2024—a remarkable 11.2 percent increase from the previous year.
To date, the UAE has signed 11 CEPA agreements with key global trade partners, including six that are already in effect. This initiative underscores the UAE’s position as Japan’s top trading partner in the Arab world. In 2023, non-oil trade between the UAE and Japan reached $17.3 billion, marking a 17.4 percent increase compared to 2022, with the UAE receiving 40 percent of Japan’s exports to Arab countries.
The CEPA negotiations represent a crucial step in deepening the economic relationship between the UAE and Japan, reinforcing their strategic partnership, and paving the way for future growth and collaboration.
