TRADE POLICY REVIEW: UNITED ARAB EMIRATES (UAE)
24 and 26 April 2006

Concluding remarks by the Chairperson


See also:
> Press release: A generally liberal economy whose perfomance could further improve with structural reform


1. This first Trade Policy Review of the United Arab Emirates has given us a very much better grasp of UAE trade policies and practices and of the challenges that it faces. Our discussions have greatly benefited from the full engagement of the UAE delegation led by Her Excellency Sheikha Lubna Al Qasimi, Minister of Economy, the insightful contributions by the discussant, Dr A. Gross, and the comments by a large number of participants.

2. Members commended the UAE for its strong economic expansion over the past decade. This was the result of the exceptional performance of the hydrocarbon subsector, but also of a successful diversification strategy partly supported by a large influx of foreign labour, and a generally open and business-oriented environment. Some concerns were expressed about the UAE's recent inflationary pressures, its limits on foreign equity participation, and its “emiratization” policy. Information was sought about the type of exchange rate system envisaged by the Gulf Cooperation Council (GCC), of which the UAE is a member. Members asked about the schedule for full harmonization of policies under the GCC, and how the UAE reconciled its bilateral FTA negotiations with its GCC membership.

3. The UAE's applied tariff, based on the GCC common external tariff, is low, at an average of some 5%; most of the UAE's applied MFN tariffs (except on alcohol and tobacco) are zero or 5% . The entire tariff is bound but some 30 applied rates exceed bindings. Customs procedures are simple, facilitating trade. Most of the UAE's trade takes place on an MFN basis, lending added emphasis to the importance of the multilateral system to the UAE's trade performance and therefore to the need for the UAE's further active participation in the WTO. Several participants noted the absence of competition legislation, that importing activities and distribution services could be reserved for exclusive national agents, and that branches of foreign companies were obliged to recruit a local agent. In these areas relevant laws are being considered for adoption or amendment. Clarification was sought about the procurement regime of non-federal public bodies, including state-owned enterprises and municipalities, and about the UAE Offsets Group.

4. Many Members sought information on UAE standards and technical regulations, including its conformity assessment and accreditation systems, and invited it to add to its TBT notification. Further clarification was sought about the UAE’s 32 free zones, its protection of geographical indications, well-known marks, and confidential information, and about the enforcement of its legislation on intellectual property.

5. In services, a vibrant, growing sector of the economy, certain Members noted that the emirate governments retain control over certain activities, and asked whether, as part of its economic reforms, the UAE intended to separate the regulatory functions of state enterprises from their commercial activities. Information was sought about the end of the State monopoly in telecommunications. Given that the UAE was a “world-class” supplier of key services, such as maritime transport and tourism, some Members invited it to undertake further commitments in the ongoing services negotiations.

6. Members very much appreciated the responses provided by the UAE delegation to all questions.

7. In conclusion, I congratulate the UAE on the openness of its trade regime and encourage it to pursue its reforms, including further improvement of its multilateral commitments, with a view to enhancing the transparency and predictability of its trade regime, and its adherence to WTO principles. I invite Members to assist the UAE by keeping their markets open for products and services of interest to it.