The United Arab Emirates and Ukraine sealed a wide-ranging trade pact on Monday, opening up fresh business prospects as Kyiv builds stronger bonds with Gulf states amid its ongoing war with Russia.
UAE President Sheikh Mohamed bin Zayed Al Nahyan and Ukrainian President Volodymyr Zelensky witnessed the signing of the Comprehensive Economic Partnership Agreement in Abu Dhabi. The deal wipes out customs duties on nearly all trade between both nations.
Building Bridges Across Trade and Investment Sectors
The agreement brings an expected $1 billion boost to the combined GDP of both countries by 2031. It removes tariffs on 99 percent of Ukrainian imports from the UAE and 97 percent of Ukrainian exports to the Emirates.
UAE Minister of State for Foreign Trade Dr. Thani Al Zeyoudi highlighted the deal's broad scope. "The CEPA opens opportunities for strategic investments across sectors such as infrastructure, agriculture, and technology, while enabling start-ups and promoting knowledge exchange between our two nations".
The pact targets growth in infrastructure, heavy industries, aviation, space sciences and IT. It fits within the UAE’s broader push to lift non-oil trade to $1.1 trillion by 2031.
Gulf States Step Up Regional Peace Efforts
The UAE has played a key role in prisoner exchanges between Russia and Ukraine. Zelensky acknowledged the UAE’s mediation efforts had “saved many lives.”
The Ukrainian leader’s Gulf tour continues with a stop in Saudi Arabia on Wednesday. The visit coincides with talks between US and Russian officials in Riyadh aimed at mending ties between Washington and Moscow.
Saudi Arabia has stepped up its role in regional diplomacy. The kingdom hosts breakthrough US-Russia talks and an Arab leaders’ summit on Gaza this week, suggesting its return to the diplomatic fold.
Growing Economic Links Despite War’s Shadow
Before Russia’s invasion, bilateral trade between the UAE and Ukraine stood at $1.15 billion. While war disrupted commerce, trade flows have begun recovering, reaching $372.4 million in 2024.
First Deputy Prime Minister Yulia Svyrydenko stressed the agreement’s timing. Signing the CEPA with the UAE marks a new era of friendship and paves the way for joint development, she said.
Beyond the immediate trade benefits, the deal creates a platform for bilateral investment partnerships between business communities. Both countries identified logistics, transport projects, travel, tourism and agriculture as key areas for quick collaboration.
The existing joint foreign direct investment stock between the countries totals $360 million. Given Ukraine’s ongoing reforms and potential EU membership, UAE officials expect growing interest in the country as an investment spot.
Agricultural Sector Takes Centre Stage
Ukraine’s agricultural prowess stands out as a key attraction for Gulf investors. In 2024, agricultural exports reached $24.7 billion, making up 59% of total exports. The country cultivates 24.5 million hectares of land, including 20.1 million hectares of grains and oilseeds.
Success stories like Continental Farmers Group, which farms 200,000 hectares in western Ukraine, showcase the potential for Gulf investors. The company paid $1.6 billion in taxes in 2024 and plans to expand its Ukrainian operations.
This first Gulf trade deal opens doors for Ukraine to ink similar pacts with other regional states. A Ukrainian-Saudi business forum planned for May 2025 signals growing Gulf interest in forging stronger economic ties with Kyiv.
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