Dr. Thani bin Ahmed Al Zeyoudi, the UAE Minister of Foreign Trade, has announced that the recently signed Comprehensive Economic Partnership Agreement (CEPA) between the United Arab Emirates and Canada is expected to significantly contribute to both nations’ economies. The agreement is projected to add approximately $8.7 billion to the UAE’s national output and increase UAE exports to Canada by around $11.8 billion by 2033. In a statement to the Emirates News Agency (WAM) commemorating the signing, Al Zeyoudi highlighted the anticipated positive impacts on trade and investments between the two countries.
A Milestone Agreement with G7 Member
Al Zeyoudi noted that this CEPA marks the first agreement of its kind established by the UAE with a G7 member nation. He expressed confidence in the progress being made with other countries, underscoring that the agreement with Canada represents a significant milestone within this collaborative framework.
Trade Liberalisation at High Levels
The CEPA includes extensive trade liberalisation measures, covering roughly 99% of total trade between the UAE and Canada and addressing 97% of all tariff items. This strong foundation is built on a robust trade relationship; non-oil trade between the two countries reached about $4.2 billion last year, experiencing a growth of over 22% year-on-year. Furthermore, in the first half of the current year, trade growth was reported at 18% compared to the same period in the previous year.
Benefits to Both Economies
Numerous products are anticipated to benefit from this agreement. UAE exports to Canada currently include iron, aluminium, gold, electronics, pharmaceuticals, and food industry products. Similarly, Canadian exports to the UAE will see advantages, with machinery, electronic devices, spare parts, and food items all positioned to gain from the CEPA. The agreement also highlights potential opportunities for re-manufacturing and export to international markets.
Investment Opportunities and Sectors of Focus
The agreement places a strong emphasis on the services and investment sectors. Al Zeyoudi highlighted ongoing UAE investments in Canada, including commitments announced during the visit of the Canadian Prime Minister to the UAE last year, amounting to $50 billion. Presently, trade and investment negotiations are taking place between Emirati and Canadian companies, valued at approximately $15 billion.
Key Sectors of Investment
Current investments primarily focus on the energy sector, which is pivotal to the bilateral relations, as well as the logistics sector through significant investments by DP World, bolstering its strong presence in Canada. The real estate and infrastructure sectors also remain vital components of this economic partnership. Looking ahead, there is a concentrated effort on data centres, which are expected to play a crucial role in future investments.
Strengthening Trade and Business Ties
Al Zeyoudi stated that several agreements and memorandums of understanding will soon be announced as part of this partnership, aiming to maintain momentum in UAE-Canada relations. He also pointed out the reverse flow of investments, with Canadian firms engaging in various sectors in the UAE, including real estate, logistics, energy, and investment funds that support Canadian interests in the region.
Gateway to Expansive Markets
The agreement offers substantial opportunities for small and medium enterprises (SMEs) and entrepreneurs, particularly in service sectors that facilitate business operations within the UAE. Al Zeyoudi concluded by emphasising that Canada views the UAE as a strategic gateway to the Middle East and Africa, while the UAE considers Canada a conduit for expanding its investments and reaching the American market.