When policymakers talk about “trade facilitation”, they are referring to a specific set of measures that streamline and simplify the technical and legal procedures for products entering or leaving a country to be traded internationally. As such, trade facilitation covers the full spectrum of border procedures, from the electronic exchange of data about a shipment to the simplification and harmonization of trade documents to the possibility to appeal administrative decisions by border agencies. In a globalized world where goods often cross borders many times as both intermediate and final products, trade facilitation helps lower overall trade costs and increase economic welfare, in particular for developing and emerging economies.

The trade facilitation objectives were introduced in the international agenda basically because of four main factors-

1) The successful implementation of the trade liberalization policy within the WTO frameworks caused the significant reduction of tariff and non-tariff barriers, that is common for developed countries (the average rate of customs duty from 4,5% to 6,5%, the share of duty free HS subheadings in customs tariffs from 29,2% to 53%). This reduced the revenue functions of customs and thus, the possibility of simplifying customs procedures with a moderate level of risk for national revenue opened up for a significant number of states.

2) The reduction of customs tariffs has caused the situation where the amount of import duties has become commensurate or even lower than trade transaction costs (TTC) with regards to compliance with customs and border formalities, since the latter are estimated on various data ranging from 1.5% to 15% of the transaction value. Respectively, trade transaction costs has started to be considered as the main trade barrier in the conditions of liberalized market access.

3) The industrial development in the modern global world based on the Global Value Chains (GVC) has transformed a cross-border movement of goods. Today, up to half of the total imports and exports of developed countries are “intermediate goods”, which are components of the corresponding GVCs. Accordingly, the cost of customs borders for business has increased significantly.

4) The expansion of production processes based on the principles of Just-In-Time (JIT) and of e-commerce shipments, which increased the requirements for the speed release of goods by customs.


The UAE became a contracting party to the General Agreement on Tariffs and Trade in 1994, and subsequently became a member of the World Trade Organization in April of 1996.

The UAE has signed GCC Free Trade Agreements with several countries and trade groups across the world to enhance its position as a global trade hub and a major destination for investments. It also seeks to increase Emirati exports, improve competitiveness in foreign markets, regulate competition, reduce trade barriers facing national products, boost its investments abroad, and protect intellectual property rights. This also covers tariff barriers, trade services, investments, intellectual property rights, dispute settlement, investment in manufacturing sectors, and protection of property rights to prevent the trafficking of counterfeit products. 

The UAE is party to several multilateral and bilateral trade agreements, including with partner countries in the GCC (Gulf Cooperation Council).  As part of the GCC, the UAE has strong economic ties with Saudi Arabia, Kuwait, Bahrain and Oman, meaning the UAE shares a common market and a customs union with these nations.  Under the Greater Arab Free Trade Area Agreement (GAFTA), the UAE has free trade access to Bahrain, Egypt, Iraq, Jordan, Kuwait, Lebanon, Libya, Morocco, Oman, Palestine, Qatar, Saudi Arabia, Syria, Tunisia, and Yemen

In addition, the UAE has signed free trade agreements with Singapore (through the GCCs agreement with the nation) and New Zealand, and has engaged in  talks about the establishment of similar arrangements with the Argentina, Australia, Brazil, China, European Union, India, Japan, Pakistan, Paraguay, South Korea, Turkey, and Uruguay.  It has also entered into a number of agreements on the protection and promotion of investment and the prevention of double taxation. 


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