UAE and Cambodia launch comprehensive economic partnership agreement negotiations

Negotiations reflect the two sides' shared keenness to strengthen bilateral economic relations, boost trade, and enhance exporters' access to markets, among others

The UAE and Cambodia launched negotiations for the establishment of a comprehensive economic partnership agreement (CEPA) between the two countries. The agreement is aimed at boosting constructive cooperation and the flow of trade and investment between the UAE and Cambodia, in line with the two countries’ shared commitment to promote cooperation in sectors of common interest and create more opportunities for both business communities.

H.E. Dr. Thani bin Ahmed Al Zeyoudi, Minister of State for Foreign Trade, and H.E. Pan Sorasak, Minister of Commerce of Cambodia, announced the official launch of the CEPA negotiations during a ceremony organized specifically for this purpose in Abu Dhabi, in the presence of several senior government officials and private sector representatives from the two countries. The first round of the negotiations took place immediately after the ceremony. 

The CEPA negotiations with Cambodia is the latest in a series of similar agreements that were forged under the economic partnership program announced by the UAE last year as part of the ‘Projects of the 50,’ aimed at expanding the network of the UAE's trading partners by adding global and regional markets of strategic importance. As part of the program, the UAE has signed three agreements so far, with India, Indonesia and Israel. The first agreement with India entered into force last May, while the second and third agreements are set to come into effect soon. Talks are currently being held with other countries such as Turkey, Georgia and Colombia as well.

Once concluded, the UAE-Cambodia CEPA is expected to contribute to increasing trade exchanges between the two countries. The non-oil trade between the two countries amounted to USD 279 million in the first eight months of 2022 with more than 40 per cent growth compared to the same period in 2021 and 26 per cent compared to 2019. The UAE is Cambodia's number one trade partner in the Arab world, accounting for 77 per cent share of its trade with the region. In addition, the UAE's investments in Cambodia totalled USD 3 million by the end of H1 2022.

H.E. Dr. Thani Al Zeyoudi highlighted that the UAE has been expanding the base of its trading partners by pursuing the CEPA program launched as part of the Projects of the 50, on the basis of its belief that trade is one of the most important catalysts for economic growth. Therefore, ensuring the uninterrupted flow of trade and investments between all parts of the world contributes to completing the global economic recovery and driving sustainable development. So, the UAE welcomes cooperation and partnership with countries that share the same vision on the development of global trade, he said.

H.E. Al Zeyoudi explained that the expansion of the UAE's foreign trade is a central focus in its economic diversification strategy and in doubling the national GDP to reach AED 3 trillion by 2030, with focus on future economy sectors based on knowledge and innovation.

He added: “Cambodia is an emerging economy in the middle of Asia. The country has promising industrial and agricultural sectors and a proven track record in renewable energy. It is our shared desire to achieve long-term sustainable economic growth, and the UAE is keen to work together to enhance the tourism and logistical capabilities of Cambodia and improve the accessibility of its products to global markets. Through the discussions that will take place in various rounds, the two countries will be able to agree on mechanisms that will ensure a long-term win-win partnership.”

Meanwhile, H.E. Pan Sorasak underlined the major role that the CEPA will play in enabling Cambodia and the UAE to further benefit from the potential economic integration between them, in light of the potential of the two vibrant economies in the two countries and the unique geographical and economic advantages. He pointed out that the agreement between Cambodia and the UAE will significantly drive the growth of the two economies by strengthening supply chains, supporting trade flows, and encouraging mutual investment, thus consolidating economic cooperation to achieve inclusive, resilient and sustainable growth for both countries and beyond.

He said: “The launch of the CEPA negotiations between the UAE and Cambodia is an important step towards the future of our bilateral cooperation. These efforts build on existing friendly relations between the two countries and contribute to strengthening the ties between the Arab world and the Association of Southeast Asian Nations (ASEAN), as the two regions are currently among the most dynamic economic regions in the world and therefore, there exists numerous opportunities to explore. The UAE could be Cambodia’s gateway to the Arab market. Likewise, Cambodia has the potential to serve as an ideal gateway for the UAE to reach Southeast Asia.”

The CEPA negotiations between the UAE and Cambodia reflect the two sides' shared keenness to strengthen bilateral economic relations, boost trade, increase exporters' access to markets, and create a more flexible and efficient platform for further investment exchanges and joint projects in priority sectors.

Cambodia’s economy witnessed rapid growth at an annual rate of 7.7 per cent between 1998 and 2019. In 2022, its GDP is expected to grow by 5.1 per cent, making it one of the fastest growing economies in the world. Cambodia’s economic prospects and strategic importance as a key market in the region were also enhanced by its ratification in 2021 to the Regional Comprehensive Economic Partnership, the largest trading bloc in the world and the free trade agreement signed with China.