Arab News, Wed, Feb 28, 2024 | Shaban 18, 1445
UAE, Peru announce free trade talks
Emirates:
The UAE and Peru have announced that they will start talks for a free trade
agreement later this year.
The announcement came on the sidelines of a World
Trade Organization meeting in Abu Dhabi, and builds on a decision by Peru
earlier this month to open an embassy in the UAE. The two countries previously
signed other agreements, including an aviation pact last year.
If the free trade agreement is reached, it would
be a first for Peru with a country in the Middle East and North Africa, and the
first for the UAE in the Americas.
Bilateral trade was just over $1 billion last
year, with Peru exporting $1.03 billion to the UAE — most of it gold — and
importing $44 million from the Gulf state.
Peru’s government hopes a free trade agreement
will help ramp up its exports. Its Foreign Trade and Tourism Ministry reported
that the UAE, with a population of over 9 million, imports more than 90 percent
of the food it consumes. Peru wants to fill part of that demand.
The country is the world’s top exporter of grapes,
and among the world leaders in avocado and blueberry exports.
It is also a key fishing country, exporting fish
for human consumption, as well as fishmeal and fish oil for industry. The
ministry also sees opportunities for garments and other manufactured products.
Emirati exports to Peru are primarily
petroleum-based products, with some manufactured goods such as lighting
components.
DP World, the UAE-based logistics company,
operates key port installations in Peru and has invested more than $700 million
there since 2018.
A free trade agreement could be a stepping stone
to larger markets for both countries. Peru has 19 such deals, including with
China, the EU and the US.
It is actively negotiating a deal with India, with
the last round held in mid-February. It was also negotiating with Turkey but
talks have stalled.
The UAE has a limited number of free trade
agreements outside its immediate geographic area, primarily through the Gulf
Cooperation Council.
The GCC signed an agreement with South Korea in
December, and one with Pakistan has been concluded. It is also negotiating with
Britain, China and Japan.
The GCC has few non-petroleum ties with Latin
America and the Caribbean, but that could be changing.
It has made initial overtures for an agreement
with the Southern Common Market, which includes Argentina, Brazil, Paraguay and
Uruguay.
The UAE and Guyana, South America’s only
English-speaking country, have been strengthening ties.
The UAE announced in November that it would open
an embassy in Guyana’s capital Georgetown. Bilateral trade is close to $1
billion.
The deal with Peru would be through bilateral
negotiation instead of with the GCC. The same is true for any potential deal
with Guyana.