UAE and Malaysia agree to Cepa negotiations

The UAE and Malaysia have agreed to start negotiations on a Comprehensive Economic Partnership Agreement to boost trade ties between the two countries.

A joint statement to start talks on the trade deal was signed on the sidelines of the official visit of Sheikh Khaled bin Mohamed, Crown Prince of Abu Dhabi, to the Malaysian capital Kuala Lumpur yesterday, state news agency Wam reported.

The negotiations “have built upon strong growth in bilateral trade and investment over recent years”, said Dr Thani Al Zeyoudi, Minister of State for Foreign Trade.

Non-oil trade between the UAE and Malaysia reached $4.6 billion last year, a growth of 5 per cent compared with the previous year and up 31 per cent from 2020.

“Today, the UAE is Malaysia’s 17th trade partner globally and the second in the Middle East, accounting for 32 per cent of Malaysia’s trade with Arab countries,” Dr Al Zeyoudi said.

“The UAE is also the first destination for Malaysian merchandise exports to Arab countries, accounting for 40 per cent of its exports to the region. The other way, Malaysia ranks eighth globally for UAE exports and 19th in re-exports.”

The value of Malaysian investments in the UAE amounts to $150 million across the sectors of industry, construction, real estate, trade, transport, storage, financial activities, insurance, and professional and technical activities, he said.

Meanwhile, UAE investments in Malaysia stand at more than $220 million, including more than $51 million in the industrial sector.

The UAE, the Arab world’s second-largest economy, is seeking to develop closer trade and investment relations with partners around the world.

It is working towards signing 26 Cepas as it seeks to diversify its economy, Minister of Economy Abdulla bin Touq said in March.

The country has already signed Cepas with India, Israel, Indonesia and Turkey, and is close to finalising agreements with Kenya.

Last month, it finalised the terms of a similar pact with Cambodia and also recently concluded negotiations for a new trade deal with Georgia.

The UAE also started talks for Cepa deals with Costa Rica, as well as Thailand and Vietnam.

“With the commencement of negotiations for the Malaysia-UAE Cepa, Malaysia is committed to enhancing the long-standing economic partnership with the UAE,” said Tengku Zafrul Aziz, Malaysian Minister of Investment, Trade and Industry.