Australia Pursues Trade Deal With UAE After EU Hiccup

A picture shows a general view of the Dubai skyline including Burj Khalifa, the world's tallest building on November 24, 2023. (Photo by Karim SAHIB / AFP) (Photo by KARIM SAHIB/AFP via Getty Images)

The Australian federal government plans to start trade talks with the United Arab Emirates (UAE) in the new year.

This follows the collapse of free trade discussions with Europe in late October, despite negotiations between both sides taking place in Osaka to try seal the deal.

In a release today, the Albanese Labor government talked up the United Arab Emirates as a top trading partner in the Middle East with two-way trade worth nearly $9.3 billion 2022.

An agreement could “deepen” cooperation between the countries on areas such as the net zero transition, the government noted.

The UN’s COP28 climate change conference was just held in the United Arab Emirates (UAE), with many Australian leaders and politicians travelling to Dubai for the event.

Globally, the UAE is Australia’s 19th biggest trading partner, with UAE investment in Australia worth $12.6 billion in 2022.

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In turn, Australia exports alumina, meat, oil seeds, and education to the Middle-Eastern country.

“The UAE is a gateway to the region and beyond, with two-way goods and services trade valued at $9.26 billion in 2022,” the government said.

“The UAE is already a key market for Australian goods and services exports including alumina, meat, oil seeds, and education, with three Australian universities having campuses in-country.”

The Foreign Affairs and Trade Department is accepting submissions on the potential of a free trade deal.

Trade and Tourism Minister Senator Don Farrell described the UAE as one of Australia’s most significant trading partners.

“The Albanese government is committed to supporting Australian businesses diversify overseas markets,” Mr. Farrell said.

“A trade deal with the UAE will strengthen our relationship with one of our most important trading and investment partners in the Middle East,” he said.

“More trade means more export opportunities for Australian businesses, more national income, and more well-paying local jobs.”

Australian and European officials had met in Japan at the G7 in October in an attempt to reach a free trade agreement.

At the time, Mr. Farrell said he would not be signing a deal just for the sake of it.

In a speech to the Italian Chamber of Commerce on Nov. 22, Mr. Farrell said free trade agreements could be a “tricky business.”

“As you know, we weren’t able to come to an agreement on the EUFTA in Japan. It’s obviously disappointing–but as you all know, free trade agreements can be a tricky business, and any deal needs to be in our national interest in order to be agreed to,” he said.

“My assessment was that the EU was asking too much, and offering too little, to conclude a fair deal which benefitted both sides.”

However, Mr. Farrell noted the bloc was still an “important partner for Australia” and will remain a significant market and investor for Australian businesses.

Australia Minister for Trade and Tourism Don Farrell signs the IPEF Pillar II agreement as part of the Indo-Pacific Economic Framework and Prosperity ministerial during the Asia-Pacific Economic Cooperation (APEC) summit on November 14, 2023 in San Francisco, California.