Abu Dhabi-July 29.2024:In a historic move to strengthen economic ties, the United Arab Emirates (UAE) and Chile have signed a Comprehensive Economic Partnership Agreement (CEPA). The agreement, signed during Chilean President Gabriel Boric’s official visit to the UAE, marks a significant milestone in the bilateral relations between the two nations.
The signing ceremony took place at Qasr Al Watan in Abu Dhabi, with UAE President His Highness Sheikh Mohamed bin Zayed Al Nahyan and President Gabriel Boric in attendance. This CEPA aims to boost non-oil bilateral trade, eliminate or reduce customs duties on 99.5% of UAE imports from Chile, and open market access for services exports, significantly enhancing trade and investment flows between the two countries.
Key Objectives and Economic Impact of the CEPA
The UAE-Chile CEPA is designed to facilitate smoother trade by removing barriers and simplifying customs procedures. It establishes new pathways for investment and cooperation, particularly focusing on sectors such as manufacturing, mining, financial services, renewable energy, tourism, and agriculture. In 2023, the non-oil trade volume between the UAE and Chile reached $306 million. With the implementation of the CEPA, both countries aim to triple this figure to $750 million by 2030. The agreement is expected to increase UAE exports by $247 million, highlighting the significant economic potential of this partnership.
Strategic Importance and Statements from Leaders
Sheikh Mohamed bin Zayed emphasized the UAE’s commitment to building global developmental partnerships to serve mutual interests and provide opportunities for future generations. This agreement is seen as a cornerstone of the UAE’s economic diversification strategy, which has seen a remarkable increase in non-oil trade, reaching a record $701 billion in 2023. Chilean Foreign Minister Alberto van Klaveren noted that this is Chile’s first trade agreement with a Middle Eastern country, highlighting its strategic importance. The agreement not only boosts trade prospects but also diversifies investment sources, including in the field of sustainability.
Dr. Thani bin Ahmed Al Zeyoudi, Minister of State for Foreign Trade, highlighted the significance of the CEPA between the UAE and Chile. He noted that this is the 11th agreement for the UAE under its agreement programme, developed over the past three years and expected to come into effect within six months. Dr. Al Zeyoudi explained that the CEPA with Chile is expected to contribute an additional $73 million to the national economy by 2031 and significantly increase the country’s exports to Chile.
Future Prospects
The CEPA between the UAE and Chile is expected to pave the way for future investment agreements, fostering a robust trade and investment corridor between South America and the Gulf. This partnership is anticipated to bring mutual economic growth, providing ample opportunities for the private sector to expand and thrive on both sides.
President Boric’s visit to the UAE and the subsequent signing of the CEPA underscore the commitment of both nations to strengthen their economic ties and explore new avenues for collaboration, setting a precedent for future partnerships in the region.
Source: Emirates News Agency.
