The Comprehensive Economic Partnership Agreement (CEPA) between the UAE and Australia is set to transform trade and investment ties, benefiting key sectors like agriculture, renewables, aviation, and critical minerals. Signed after negotiations that began in December, the agreement is expected to take effect next year, pending Australia’s parliamentary approval.
“This is not just an agreement about goods and services; it’s aimed at driving growth in investment between our countries,” said Ridwaan Jadwat, Australia’s ambassador to the UAE, in an interview.
A Robust Economic Partnership
The UAE is Australia’s largest trade and investment partner in the Middle East, with bilateral trade in goods and services reaching A$10 billion (US$6.5 billion) last year and two-way investments totaling A$20.7 billion. CEPA aims to build on this foundation by streamlining trade and opening new avenues for capital flow into sectors such as renewable energy, AI, mining, and infrastructure.
As part of CEPA, an investment protection agreement and several initial pacts have been signed to ensure a structured and dynamic approach to investments. Ministerial-level involvement will further drive targeted investments in areas that benefit both nations.
Collaborating on Green Transition
Both countries are prioritizing the energy transition, with a clear focus on renewable energy and critical minerals. The UAE has been investing in Australia’s waste-to-energy projects through Masdar and infrastructure development through ADQ and DP World. Ambassador Jadwat highlighted the immense potential for UAE investments in Australia’s critical minerals sector, essential for the global green transition.
The UAE, aiming for net-zero emissions by 2050, plans to invest AED 200 billion (US$54 billion) by 2030 to sustain economic growth while meeting energy demands.
Boosting Trade Volumes
CEPA is expected to significantly increase trade between the two countries. In 2023, Australia exported goods worth A$5.2 billion to the UAE, including alumina, coal, meat, and dairy, while importing A$4.7 billion worth of petroleum products and urea. Under the agreement, over 99% of Australian exports will enter the UAE duty-free, providing a major boost to sectors like agriculture and food processing.
Canola seeds, red meat, and seafood—already significant exports—will gain duty-free access from day one, further enhancing Australia’s agricultural footprint in the UAE.
Strengthening Connectivity
Aviation is another sector poised for growth, with over 300 flights monthly between the two countries. CEPA is expected to increase connectivity, boosting tourism and business travel. Emirates recently resumed its direct flights between Dubai and Adelaide, with plans to expand services to Perth. Etihad Airways also continues to play a vital role in facilitating air travel between the two nations.
Gateway to the Middle East and Beyond
CEPA positions the UAE as a strategic gateway for Australian exports to the broader Middle East, Africa, and South Asia. “The UAE is a significant entrepôt, with goods transiting through Dubai and Abu Dhabi to reach global markets,” said Jadwat. This agreement, the first of its kind between Australia and a Middle Eastern country, is expected to unlock new trade opportunities in the region.
A Partnership for the Future
By focusing on sustainable growth and investment, the UAE-Australia CEPA goes beyond a traditional trade deal. It underscores the shared vision of both nations to leverage their strengths, drive innovation, and create mutually beneficial opportunities in an evolving global economy. This landmark agreement promises to redefine bilateral relations, setting a new standard for economic partnerships worldwide.
