The United Arab Emirates (UAE) and South Korea have successfully concluded discussions on a bilateral trade agreement called the Comprehensive Economic Partnership Agreement (CEPA). This trade deal was jointly announced by both countries on Saturday.
Over time, the UAE and South Korea have been strengthening their economic ties. In the first half of 2023, trade between the two nations, excluding oil, reached $3 billion. This marks a 21% increase compared to the same period in 2021, according to an official statement.
One major collaboration between the two nations was the construction of all four units of the Barakah Power Plant in Abu Dhabi. This nuclear power plant, costing a substantial $20 billion, became operational in April of this year and is important in supporting the UAE’s electricity needs.
Notably, South Korea was one of the initial countries with which the UAE began CEPA discussions back in 2021. However, three months later, South Korea revived previously dormant talks for a Free Trade Agreement (FTA) with the Gulf Cooperation Council (GCC) bloc, of which the UAE is a member.
Thani Al Zeyoudi, the UAE Minister of Foreign Trade, mentioned that talks with South Korea were resumed earlier this year as both nations were eager to finalize a deal and progress with their economic goals. Al Zeyoudi also highlighted that FTA discussions with the GCC are still in progress.
South Korea’s trade ministry emphasized that the Korea-UAE CEPA would not only bring stability to South Korean companies entering the UAE but also support their activities in the broader Middle East and North Africa region. As of 2022, approximately 178 South Korean firms were already engaged in business activities within the UAE.
The UAE has been proactively signing various Comprehensive Economic Partnership Agreements (CEPAs), including agreements with nations such as India, Indonesia, Israel, and Turkey. This strategy is part of the UAE’s plan to diversify its economy and reduce its reliance on oil. Importantly, the UAE stressed that its trade decisions are based on economics and are not influenced by political considerations, highlighting its commitment to separating politics from trade.
