Group 1 - Indonesia plans to sign a Comprehensive Economic Partnership Agreement (CEPA) with the European Union by the third quarter of 2026 [1]

Core Insights - The UAE and the EU have officially launched negotiations for a bilateral free trade agreement, marking a significant step in the UAE's efforts to establish deeper economic partnerships with more countries [1] - The Comprehensive Economic Partnership Agreement (CEPA) is a key initiative aimed at diversifying the UAE's economy away from oil dependency and enhancing its global competitiveness [2][8] Economic Diversification Efforts - The UAE has set ambitious goals under its "We the UAE 2031" vision and the "UAE 2071 Centennial Plan," focusing on sustainable development and global competitiveness [2] - CEPA aims to strengthen the UAE's international economic ties, facilitate trade, and ensure better market access for its goods and services, thereby enhancing its status as a global trade and logistics hub [2][3] - By 2031, the UAE government targets to increase non-oil foreign trade to 4 trillion dirhams and non-oil exports to 800 billion dirhams [2] Trade Growth and Impact - As of Q1 2025, the UAE has signed CEPA agreements with 26 countries, significantly boosting non-oil foreign trade [4] - In 2024, the UAE's non-oil goods trade reached a record 3 trillion dirhams, a 14.6% increase year-on-year, with exports to CEPA partner countries growing by 42.3% [4] - The CEPA with India aims to increase bilateral non-oil trade to 100 billion USD annually by 2030, with trade exceeding 240.2 billion dirhams in 2024 [4] Economic Benefits of CEPA - CEPA has led to substantial economic benefits by reducing tariffs and enhancing customs facilitation, lowering overall trade costs [5] - The agreements promote procurement diversification, reducing reliance on single markets and enhancing supply chain resilience [5] - CEPA has also restructured the UAE's internal economy, fostering a vibrant private sector and integrating SMEs into global value chains [5][6] Future CEPA Expansion - The UAE is actively pursuing new CEPA partnerships, with negotiations with Japan nearing completion and discussions ongoing with several other countries [7] - Future CEPA agreements will focus on emerging markets and strategic sectors such as AI, renewable energy, and digital economy [7] - CEPA serves as a tool for the UAE's foreign policy, promoting open trade and reducing dependency on single major powers, thereby enhancing its diplomatic influence [8]