Canada and the United Arab Emirates have finalized a comprehensive trade agreement designed to lower economic barriers and increase investment flows between the two nations. The signing marks a strategic move by Canadian leadership to broaden international commercial ties as relations with the United States face ongoing strain.
Prime Minister Mark Carney and Abu Dhabi Crown Prince Sheikh Khaled bin Mohamed bin Zayed Al Nahyan presided over the ceremony for the Comprehensive Economic Partnership Agreement (CEPA). The pact is scheduled to enter into force in 2027, with provisions aimed at cutting tariffs, reducing administrative hurdles, and improving market access for businesses in both countries.
Eliminating Tariffs on Canadian Exports
The Prime Minister’s Office outlined the economic impact of the new deal in a statement released after the signing. Officials noted that once the agreement is fully implemented, it will reduce or eliminate tariffs on more than 99 percent of current Canadian exports destined for the UAE.
This tariff removal opens new avenues for specific Canadian industries. The statement highlighted opportunities for farmers producing pulses and canola, manufacturers of industrial machinery and power generation equipment, and the country’s aerospace sector. The agreement also addresses non-tariff barriers to create a more predictable environment for trade and investment.
Market access will expand for Canadian goods and services across several key sectors, including industrial, agricultural, forest, fish and seafood, environmental, and engineering fields. The UAE currently stands as the largest Middle Eastern market for Canadian exports and is a significant buyer of Canadian motor vehicles, parts, and machinery.
Diversifying Trade Amid US Tensions
The push for this agreement aligns with Prime Minister Carney’s pledge to double Ottawa’s non-US trade over the next decade. Recent attempts to reach a new deal with Washington have broken down, prompting the Canadian government to aggressively pursue pacts with partners across the Asia Pacific, Europe, and the Middle East.
Two-way trade between Canada and the UAE was valued at 3.5 billion Canadian dollars last year. Government data indicates that this commercial relationship has been growing at a rate of 10 percent annually for the last few years. The UAE also committed up to 50 billion dollars in investment in Canada last year.
Thani bin Ahmed Al Zeyoudi, the UAE’s Foreign Trade Minister, signed the CEPA with his Canadian counterpart, Maninder Sidhu. Al Zeyoudi emphasized the potential for private sector growth through improved market access and investment opportunities in high-growth areas such as logistics, communications, advanced technology, and manufacturing.
He stated that these developments support the pursuit of a resilient, diversified, and globally connected economy. In addition to the main trade pact, the two nations signed preliminary agreements covering energy, diplomatic, and defence cooperation.
Source: Al Jazeera
