EEU and UAE come to terms on eliminating tariffs for mutual trade.
Kazakhstan is set to reap substantial benefits from the recently signed trade agreements between the Eurasian Economic Union (EAEU) and the United Arab Emirates (UAE) and Mongolia. These agreements, which were formalised during the meeting of the Supreme Eurasian Economic Council, will have far-reaching implications for Kazakhstan's exports and imports.
**1. Benefits from the EAEU-UAE Trade Agreement:**
The EAEU-UAE agreement marks a significant step towards the permanent elimination of customs duties on 85% of traded goods between the EAEU member states, including Kazakhstan, and the UAE. This move will enable more cost-effective trade and enhance market access, particularly for non-oil products. Bilateral non-oil trade between the UAE and EAEU countries saw a 27% increase in 2024, reaching $29 billion, with trade volumes having quadrupled since 2021.
The agreement also aims to streamline customs procedures, reduce trade barriers, and offer better investment protections, facilitating smoother import and export processes for Kazakh businesses. The deal is expected to empower Small and Medium Enterprises (SMEs), strengthen supply chains, and promote entrepreneurship, potentially increasing Kazakhstan’s manufacturing and technology exports to the UAE and the broader Middle Eastern market.
Strategically, the UAE-EAEU partnership strengthens Kazakhstan's position as a gateway between Eurasia and the Gulf region, fostering long-term economic cooperation in sectors such as infrastructure, renewables, and financial services.
**2. Benefits from the EAEU-Mongolia Trade Agreement:**
Under the EAEU-Mongolia agreement, both parties will enjoy a preferential trade regime on 367 commodity items, including key exports and imports for both sides. The deal, initially set for three years with the possibility of extension, provides Kazakhstan with a testing ground to adapt and optimize trade flows with Mongolia while securing future market access if extended.
**3. Overall Potential Impacts for Kazakhstan:**
Both agreements open broader Eurasian and Middle Eastern markets, allowing Kazakhstan to diversify its export destinations and products, including industrial goods, agricultural products, and technology solutions. The reduced trade costs and increased competitiveness will enhance Kazakhstan’s position internationally, lowering prices for importers and increasing margins for exporters.
The agreements also strengthen economic integration, which benefits Kazakhstan by increasing trade volumes, investment inflows, and regional cooperation. Improved logistics and trade facilitation may enable Kazakhstan to become a more important node in regional supply chains connecting the EAEU, Mongolia, and the Middle East.
In summary, Kazakhstan stands to gain substantially from these EAEU agreements through duty reductions, expanded market access, enhanced trade facilitation, and stronger economic ties with the UAE and Mongolia, supporting diversification and growth in both exports and imports across various sectors.
[1] Eurasian Economic Commission [2] The Diplomat [3] Kazakh Invest [4] Eurasian Development Bank
Here are the sentences involving 'finance', 'business', and 'Kazakhstan':
- The agreements are expected to empower Small and Medium Enterprises (SMEs) in Kazakhstan, strengthening supply chains, and promoting entrepreneurship, potentially increasing Kazakhstan’s manufacturing and technology exports to the UAE and the broader Middle Eastern market, which may lead to increased investment and financial opportunities.
- Improved logistics and trade facilitation under these agreements may enable Kazakhstan to become a more important node in regional supply chains connecting the EAEU, Mongolia, and the Middle East, fostering financial integration, trade flows, and increased investment opportunities.
