UAE – Trade Policy

Bilateral Agreements

The UAE has signed bilateral preferential agreements with some Arab Countries (Syria, Jordan, Lebanon, Morocco and Iraq). According to these agreements, the UAE and its partners accord each other preferential access for a specified list of goods. As at the end of November 2015 the UAE signed 43 agreements related to encouragement and protection of investment and signed 92 agreements on avoidance of double taxation with different countries (35 with European countries; 26 with Asian countries; 11 with Arabic countries; 12 with African countries and 8 with North & Latin America).

Regional Agreements

•       Gulf Cooperation Council (GCC)

The UAE was a founding member of the GCC on the 25th of May, 1981, alongside Bahrain, Kuwait, Oman, Qatar, and Saudi Arabia.

The Unified Economic Agreement (UEA), signed on the 11th of November 1981 under the Gulf Cooperation Council (GCC) created a Free Trade Area between the GCC states compatible with Article XXIV of GATT Agreement 1994. The free-trade area had eliminated duties and other restrictive regulations of commerce on all trade between the members of the GCC in the products originating in the member states, and work was proceeding to further harmonize trade and commercial policies.

In December 2001, the GCC Economic Agreement was signed to provide for a GCC Customs Union, and the harmonization of economic, financial, and monetary policies, with a view to achieve more economic integration through the establishment of the Gulf Common Market (GCM), which went into effect on January 2008.

The GCC Customs Union was established and has been operative since the beginning of January 2003. GCC member states have been applying the GCC common tariff ever since. The rates for more than 89.1% of the common tariff lines were 5%, while 10.4% of the tariff lines had a common tariff of 0%. Moreover, 0.2% of the tariff lines had a rate of 50%, while the remaining 0.3% of the tariff lines had a rate of 100%. The Common Customs Law of the GCC entered into force on 11th January 2015.

In implementation of the Supreme Council‘s resolution issued by the Gulf Cooperation Council (GCC) in its 28th session (on the 4th of December, 2007). The Gulf Common Market (GCM) was launched with effect from the 1st of January 2008 which is seen as an advanced phase in the Gulf Economic integration. The aim of the GCM is the creation of a single market through which the citizens of the GCC countries make use of the opportunities available in the Gulf economy, opening wider to foreign investment, maximizing the benefits of economies of scale and efficiency in production, achieving the optimum utilization of available resources and improving the negotiating position of the GCC countries and strengthening its position actors and influential international economic groupings.

On the liberalization of services within the GCC, the Council had liberalized trade in services for roughly 100 subsectors of services, including professional services, most business services, telecommunication services, banking and other financial services, distribution services, education services, environmental services, health and related social services and tourism services. The GCC members had agreed to progressively liberalize other services sectors and subsectors.

•       Free Trade Agreements

The UAE is currently participating in the ongoing negotiations between the GCC and its main trade partners. These negotiations have led to signing Free Trade Agreements between the GCC members and Singapore, the EFTA States, and entered into force with Singapore in January 2015 and entered with EFTA into force on the first of July 2015.

The FTA negotiations between the GCC and New Zeeland have been concluded but the agreement has not yet been signed yet by the parties and negotiations are ongoing with Turkey, Japan, South Korea, China, India, Pakistan, Australia, EU and the Southern Common Market (MERCOSUR). The scope of these negotiations covers market access for goods and services, intellectual property, and in some cases, government procurement, investment and competition.

•       Greater Arab Free Trade Area (GAFTA)

The UAE is a member of The Greater Arab Free Trade Area (GAFTA), which was signed on the 19th of February 1997 and entered into force on the 1st of January 1998. This agreement has eliminated all tariffs among its members on the 1st of January 2005. The Agreement covers trade in goods only; however, members have been engaged for the past few years in negotiations to create an agreement in trade in services.

•       UAE Priorities in DOHA Development Agenda (DDA)

The UAE is a strong believer and advocate of the Multilateral Trading System. It is playing an active role in the current round of multilateral trade negotiations. Its main interests in the Doha Development Agenda (DDA) include greater non-agricultural market access (NAMA), further liberalization of trade in services, trade rules and trade remedies.

In NAMA, the UAE proposed the inclusion of an additional sector under the sectorial tariff elimination initiative. The UAE has called on members to eliminate all tariffs on raw materials, in particular on primary aluminum, a vital and strategic input for its manufacturing sector.

The UAE also submitted its initial offer in services, which is basically in line with the policy objectives set by the Government and its reform process that is currently underway.

The UAE also recognizes the importance of an effective and rational “differential and special treatment” that enables domestic sectors to benefit from transitional periods of adjustments in order to take necessary steps to consolidate competitiveness. It is crucial for the survival of those sensitive activities.

The UAE also supports the strengthening of technical assistance programs for developing and least-developed countries in the following areas: Information on the Multilateral Trading System, Implementation of the WTO Agreements, and Capacity Building. The specific needs and priorities for the UAE are related to the following issues: Competition Law, SPS & TBT, customs procedures and trade facilitation, classification of some services sectors like energy services and maritime transport, evaluation of trade in services, notifications procedures related to all WTO agreements, intellectual properties rights and regionalism/bilateralism and the multilateral trading system.