New African free trade agreement is a huge opportunity for Dubai investors
Dubai’s trade with African countries could increase by 10 per cent over the next five years, following a free trade agreement which is due to launch in January 2021, Dubai Chamber of Commerce & Industry said.
The African Continental Free Trade Agreement will unlock new business opportunities across the continent in key sectors such as logistics, cold storage and warehousing, manufacturing, agribusiness, infrastructure, healthcare and pharmaceuticals, and technology, participants heard at a webinar organised by the chamber.
The agreement will create the largest free trade area in the world, encompassing a population of 1.3 billion people across 55 countries with a combined gross domestic project of $3.4 trillion.
Trade between Dubai and Africa has already increased significantly over the last five years, with a compound annual growth rate (CAGR) of 11 per cent, according to the chamber.
Imports from Africa increased by 14 percent, exports increased by 13 percent and re-exports by six percent.
Bilateral non-oil trade reached a value of nearly AED 1 trillion ($272 billion) between 2011 and 2019.
The agreement represents a huge opportunity for UAE investors, who will be able do business across the continent based on a single set of trade rules, said Omar Khan, the chamber’s Director of International Offices.
“Dubai is well placed to benefit from the landmark trade agreement due to its status as a preferred re-export hub for African traders and strong presence of UAE companies in African markets and vice versa,” he said.
The UAE invested $25 billion in Africa between 2014 and 2018, making it the fourth biggest investor in the continent after China, Europe and the United States.
Participants also heard from the chamber’s economic research department, who said changing dynamics brought about by the trade agreement and by Covid-19 situation have created opportunities for businesses in Dubai to reposition themselves and explore new African markets as they prepare for recovery.
Source : Zawya | Photocredit : Google