The European Union (EU) and the United Arab Emirates (UAE) have formally agreed to begin negotiations on a free trade agreement, in a strategic effort to strengthen bilateral ties and diversify international partnerships. The announcement was made following a phone call on Thursday between European Commission President Ursula von der Leyen and UAE President Sheikh Mohamed bin Zayed Al Nahyan.
According to the EU statement, the negotiations will aim to enhance trade in goods, services, and investments. The talks reflect a broader ambition by Brussels to reduce economic reliance on traditional allies such as the USA, particularly in light of ongoing trade tensions.
EU seeks alternative trade partners amid tariff uncertainty
The push for closer ties with the UAE comes in the context of a trade uncertainty due to Donald Trump‘s new presidency. Few days ago, USA President announced a series of global tariffs, triggering a wave of retaliatory measures and prolonged uncertainty in transatlantic trade. Though these tariffs have been later suspended by USA, they prompted the EU to explore more diversified trade relationships, especially with fast-growing economies in the Middle East and Asia.
“Diversifying our trade partnerships is essential for economic resilience,” said an EU spokesperson. “The UAE is a key regional player with shared interests in sustainable development and innovation.”
In 2023, total trade in goods between the EU and the UAE reached over €50 billion, according to Eurostat. The UAE is already the EU’s largest trading partner in the Gulf Cooperation Council (GCC), and a new agreement could further boost bilateral investment flows and supply chain integration.
Next steps in the negotiation process
No specific timeline has been set for the conclusion of the agreement, but both parties signaled a desire to move swiftly. Negotiators will begin drafting the scope of the deal in the coming months, with stakeholder consultations planned on both sides. The EU is also expected to align the talks with its broader strategy on trade and sustainable development.
As global economic alliances continue to shift, this new partnership could mark a significant milestone in the EU’s pivot toward emerging markets. If successful, the free trade agreement with the UAE could serve as a blueprint for similar deals with other strategic partners in the region.
