The trade agreement signed between Turkey & UAE on 3 March will significantly impact both nations’ economies. With projections suggesting that bilateral trade volumes could more than double to between $40 billion and $45 billion within the next five years, the agreement marks a significant milestone in the relationship between the two countries. The deal focuses on several key sectors, including agritech, clean energy, logistics, and construction. In addition, reducing tariff fees between the two nations is set to be a boon, with 82 percent of these fees being slashed as part of the agreement. The UAE’s Minister of State for Foreign Trade, Thani Al Zeyoudi, has stated that the move will help stimulate economic growth and provide business opportunities in both countries.
The signing of the trade agreement follows a $4.9 billion currency swap agreement made with Ankara last year, as well as billions of dollars worth of investments pledged by the UAE in Turkey through government-affiliated entities. Turkey is now the UAE’s sixth-largest trading partner for non-oil trade, with bilateral trade between the two countries hitting $18.9 billion last year, representing a 40 percent increase from the previous year. With the agreement’s focus on critical sectors, including those related to sustainable and green technology, the deal is also expected to impact the environment positively. In addition, the agreement is a demonstration of the UAE’s commitment to strengthening its trade relationships with countries around the world while also supporting the development of new and innovative industries that will help to drive economic growth in the future.
Why Is It Significant For The Future of AgriTech In Both Countries?
Agritech is becoming an increasingly attractive sector for investment, driven by the need for countries to become more self-sufficient and reduce their reliance on global supply chains. The UAE is one such country that has recognized the potential of advanced agritech to improve its food security. The Food Tech Valley project launch in Dubai in May 2021 is a testament to this commitment. The project will explore the urban planning of future smart and food-independent cities, focusing on agricultural technology and engineering, food innovation, R&D facilities, and intelligent food logistics. By investing in these areas, the UAE aims to become one of the top ten countries in the world for food security, a significant improvement from its current ranking of around 35th globally.
Similarly, Turkey has been identified as one of the most advantageous countries for agricultural production by the trade commissioner of Canada. To capitalize on this potential, Canada has focused on five agri-tech sub-sectors in Turkey: controlled environment agriculture, precision farming, high-tech farming equipment, crop protection and nutrition inputs, and livestock and animal farming technologies. These sectors offer significant opportunities for investment and growth as Turkey seeks to improve its food security and reduce its reliance on imports. With strong government support and a focus on innovation and sustainability, the agri-tech sector in Turkey is expected to continue to attract significant investment in the coming years.