Dr Thani Bin Ahmed Al Zeyoudi, Minister of State for Foreign Trade, and Dukgeun Ahn, Minister of Trade for the Republic of Korea, have concluded their negotiations towards a CEPA between the two nations, which will pave the way for a new chapter of economic cooperation.
Abdullah Saif Al Nuaimi, UAE Ambassador to South Korea, and Juma Al Kait, Assistant Undersecretary for Foreign Trade Affairs in the Ministry of Economy, attended the signing in the Korean capital, Seoul.
This represents the latest milestone in the UAE’s foreign trade agenda, launched in September 2021 to develop deeper ties with strategic allies worldwide.
A UAE-Korea CEPA will reinforce East-West supply chains, facilitate two-way FDI flows, and enhance joint research and knowledge exchange across a range of sectors, including energy, advanced manufacturing, technology, food security and healthcare.
On concluding negotiations, Al Zeyoudi said, “The Republic of Korea is an important growth partner for the UAE, with its highly sophisticated economy built on manufacturing, logistics, and advanced technology. Our two nations share a deep commitment to driving long-term, sustainable growth through trade, investment and economic diversification. Our latest CEPA will drive cooperation across each of them, empowering both economies with new insights, experiences and knowledge. This deal can potentially be a powerful catalyst for innovation and enterprise.”
The bilateral deal comes amid advancing trade exchange between the two nations. In the first half of 2023, bilateral non-oil trade reached $3 billion, which is consistent with H1 2022 and up 21 per cent in the same period in 2021.
The UAE is Korea’s second-largest Arab trade partner, while Korea is the UAE’s eleventh-largest trading partner among non-Arab Asian countries.
At the Presidential Summit in January 2023, the two nations signed a number of memoranda of understanding, including the ROK-UAE Trade and Investment Promotion Framework to pursue optimal trade collaboration strategies, covering areas such as supply chains, digital trade, logistics, business environment and technical barriers to trade, and a U$30 billion plans to invest in strategic sectors of the Korean economy.
In April this year, all four units of the US$20 billion Barakah Power Plant in Abu Dhabi, constructed by the Korea Electric Power Corporation in a consortium that included Hyundai, Samsung, Korea Hydro and Nuclear Power, and Doosan Heavy Industries and Construction, became operational, with the capability of meeting up to 25 per cent of the UAE’s electricity needs.
In June this year, Abdullah Bin Touq Al Marri, Minister of Economy, held a bilateral meeting with Lee Young, Minister of SMEs and Startups of Republic of Korea, to explore the strengthening of cooperation in promoting entrepreneurship and supporting the growth of small and medium enterprises in the two countries’ markets.
The meeting took place as part of the K-Business Day in Middle East 2023, which was held at Dubai World Trade Center on 12th and 13th June. It was attended by entrepreneurs, startup owners, investors, and business incubators and accelerators from both countries.
Bin Touq emphasised the strong, strategic relations ties between the UAE and the Republic of Korea, which continue to grow on the economic, trade and investment fronts, thanks to the shared aspirations of both leaderships to develop them and the frequent exchange of visits by high-level delegations.
He added, “The UAE is Korea’s second largest trade partner in the GCC and the Arab regions as of 2022. The UAE-Korean non-oil foreign trade totaled Dhs3.4 billion ($917 million) in the first two months of 2023, up 9 per cent from the previous year. In 2022, the volume of our non-oil trade exchanges totaled Dhs19.5 billion, reflecting a 14 percent year-on-year increase.”
The Minister of Economy said, “The UAE exports to Korean markets continue to grow, achieving a notable 35 percent growth to reach Dhs627 million ($174 million) over January and February 2023. It exceeded Dhs2.8 billion ($781 million) in 2022, up 17.5 per cent.”
In terms of bilateral investments between the two countries, Bin Touq expressed confidence in the increasing momentum of UAE investments across various economic and commercial sectors in the Korean markets. The UAE had recently announced its intention to invest approximately Dhs110 billion ($30 billion) in South Korea over the next few years. Currently, the UAE’s investments in Korea are concentrated in several key sectors such as industry, trade, shipping, communications, real estate, and commerce. Meanwhile, South Korean FDI in the UAE reached approximately Dhs8.1 billion ($2.2 billion) as of early 2021, marking a remarkable growth of 73 per cent since the beginning of 2013. These investments primarily focus on the financial, insurance, mining, retail, real estate, transportation, energy, and technology sectors.
The meeting saw the UAE and Korea agree on new plans in the field of entrepreneurship, including programs and facilities to foster startup growth, enhance investments, and facilitate exports to new markets.
The two minister also discussed incentivising and encouraging SME owners and entrepreneurs to invest in the emerging sectors of the economy to enhance their contribution to GDP growth.