The agreement will do so through the removal or reduction of tariffs on more than 92% of product lines…reports Asian Lite News
The UAE’s Comprehensive Economic Agreement with Cambodia has officially entered into force, promising to enhance trade flows, create opportunities for strategic investment, and accelerate economic diversification for both countries.
The agreement will do so through the removal or reduction of tariffs on more than 92% of product lines, eliminating unnecessary barriers to trade, and improving market access for service exports.
The UAE-Cambodia Comprehensive Economic Agreement is the fifth CEPA to come into force; the deal has the potential to more than double the total value of non-oil trade between the UAE and Cambodia to US$1 billion by 2030. It builds on growing bilateral relations that resulted in non-oil trade exceeding US$407 million in 2022, a growth of 33% compared to 2021.
In the first nine months of 2023, the UAE’s non-oil foreign trade with Cambodia exceeded US$300 million, comparable to the same period in 2022 and 30.5% more than 2021 figures.
One of the most promising economies in South-East Asia, Cambodia experienced 5.2% growth in 2022, building on an annual growth rate of 7.7% between 1998 and 2019. Through the deal, the UAE will benefit from new export opportunities in machinery, oils and lubricants, and cars and automotive parts, while key exports expected to benefit in Cambodia include grains, fruits, meats, processed foods, apparel, footwear and leather goods.
The deal is also expected to accelerate investment flows between the two countries in priority sectors, including logistics and infrastructure, travel and tourism projects and renewable energy. Bilateral FDI stood at US$3.8 million by the end of 2020, while at the end of H1 2022, total UAE investment flows into Cambodia reached almost US$3 million.
Dr. Thani bin Ahmed Al Zeyoudi, UAE Minister of State for Foreign Trade, said, “The implementation of our Comprehensive Economic Partnership Agreement with Cambodia marks another important step forward in our foreign trade agenda, fortifying bilateral relations with a robust and agile partner in the increasingly important ASEAN region.
“This deal lays the foundations for a future-facing partnership that creates new opportunities, drives investment in priority sectors and accelerates the global economic security. By strengthening East-West trade routes, we look forward to the deal unearthing the wealth of benefits borne from open, rules-based trade, a system in which our two nations share a common belief.”
Cham Nimul, Minister of Commerce of Cambodia, said, “The Cambodia-UAE CEPA is unique for both of us. It will enhance the relations and cooperation between the two countries and will reinforce the growing links between Arab world and ASEAN. The two regions are today amongst the most economically dynamic regions in the world. Therefore, there are potential growth to be explored. The UAE can be Cambodia’s base for the Arab market. Likewise, Cambodia can be the UAE’s base for the ASEAN region.”
She stressed that the CEPA between Cambodia and the UAE will serve as a great impetus for shared growth by fostering supply chains, enhancing trade flow, promoting bilateral investment, and giving rise to the economic synergy for inclusive, resilient and sustainable growth for both countries and beyond.
The Minister highlighted its alignment with Cambodia’s Pentagonal Strategy Phase I, specifically Pentagonal 2: economic diversification and enhancement of the competition.
The Comprehensive Economic Partnership Agreement is a vital component of the UAE’s foreign trade agenda, which seeks to establish stronger, more integrated trading relationships with the most dynamic markets worldwide.