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Korea Clinches Trade Deal with UAE

October 16, 2023
in News
Korea Clinches Trade Deal with UAE
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Korea has finalized negotiations for a Comprehensive Economic Partnership Agreement with the UAE, the first free trade agreement with an Arab nation.

It will lead to the elimination of tariffs on major products such as cars and oil within the next 10 years, while economic cooperation in sectors like energy, resources and advanced industries will increase substantially.

CEPA also includes exchanges and cooperation in various areas.

The Ministry of Trade, Industry, and Energy in a meeting in Seoul last Saturday gave its blessing to the results of negotiations that began in April 2021 and were sped up after President Yoon Suk-yeol’s visit to the UAE this January.

Korean Trade Minister Ahn Duk-geun (right) signs a Comprehensive Economic Partnership Agreement with his UAE counterpart Thani Al Zeyoudi in Seoul on Oct. 14. /Courtesy of the Ministry of Trade, Industry and Energy

The UAE had a total trade volume of US$19.5 billion with Korea last year, making it Seoul’s 16th biggest trading partner. Both countries will eliminate tariffs on almost all goods traded between them over a maximum of 10 years after the agreement takes effect. That includes the five-percent tariff on Korean cars.

The UAE is a major importer of cars not only from Korea but also from China, Japan, the EU and the U.S., but Korea is the first with which it will have a trade deal, which is expected to benefit exports of electric cars in particular.

Even the three-percent tariff on crude oil from the UAE, Korea’s third-biggest source of the commodity, will be phased out. Tariffs on Korea’s exports of medical devices, ship parts, and weapons will be scrapped immediately.

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