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Press release: A generally liberal economy whose perfomance
could further improve with structural reform
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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. |
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