Armenia, the UAE to sign an agreement on liberalization of trade, investment and services

World 23 February, 2024 12:31

The Armenia-UAE economic relations, which experienced a sharp boost of development last year, may evolve in a new way.

The Armenian Ministry of Economy, said in response to Armenpress query, presenting the most promising directions capable of giving a fresh breath to the economic cooperation between the two countries.

The ministry has stated that the expansion and deepening of the cooperation in the fields of tourism, infrastructure, renewable energy, construction, agriculture, food industry, high technologies, digitalization, cybersecurity and innovation are particularly attractive. Cooperation in these areas promises to be mutually beneficial.

In 2023, the UAE became the second trade partner of Armenia by the volume of goods turnover, at the same time topping the list of countries that made foreign direct investments in Armenia. Last year, exports from Armenia to the UAE amounted to approximately $2.2 billion, indicating a 3.2 times increase compared to 2022. The volume of imports was relatively modest - about 600 million dollars. The indicator of 2022 was exceeded by 36.7 percent. The total trade turnover reached $2.8 billion, marking a 1.9-fold increase in just one year.

According to the Ministry, the export structure has not changed significantly compared to 2022. Last year, 96.3 percent of Armenia's exports to the UAE consisted of four main types of products: unwrought or semi-wrought gold, gold dust, jewelry, diamond stones, cigarettes and cigars. In 2022, they accounted for 98.7 percent of exports. The import structure also remained largely unchanged, with passenger cars, diamond stones, telephone spare parts, modems, and jewelry dominating. Overall, they accounted for 59 percent of goods imported from the UAE to Armenia in 2023 (compared to 60 percent in 2022). In 2023, $1.6 billion worth of goods were re-exported from Armenia to the UAE, mainly unwrought gold ($1.3 billion), diamond stones (300 million) and unwrought, semi-unwrought or in powder form ($32 million).

Last year, the UAE became the country that secured the largest volume of foreign direct investment in Armenia's economy, surpassing Russia for the first time in history. From January to September 2023, the UAE made direct investments totaling 101 billion 814.4 million drams in Armenia. The Ministry emphasizes that this indicator should not be conditioned by a separate factor, but should be considered in the general logic of the dynamics of the development of the Armenian-Emirati trade and economic relations in the recent period.

According to the Economy Ministry, the ongoing environmental improvements, the current increase in bilateral trade relations and the rising influx of tourists to Armenia are considered the main factors contributing to the development of economic cooperation between Armenia and the UAE.

The talks on the signing of an agreement on services, trade, and investment between the Government of the Republic of Armenia and the United Arab Emirates, which has begun the previous year, are currently underway. An agreement to sign such a document was reached during the negotiations on the free trade agreement between the Eurasian Economic Union and its member states and the UAE.

The agreement, in fact, liberalizes the processes of implementation of services, trade and investments between Armenia and the UAE, envisaging the removal of drawbacks, enhancing economic efficiency and creating favorable conditions in these areas. It is aimed at expanding mutually beneficial economic cooperation.