The UAE is angling for a UK trade agreement that could rewrite the template for its next CEPAs with the West

The UAE and the UK are planning to boost their diplomatic relationship with a trade agreement — one that goes well beyond what the GCC negotiated as a bloc in May. UAE-UK trade already runs about USD 30 bn a year and touches more than 14k UK exporters, but a UAE-UK CEPA could unlock a lot more, in sectors the bloc agreement barely touches.

BACKGROUND- UAE Ambassador to the UK Mansoor Abulhoul said last month that the GCC-UK agreement is a “solid foundation” for removing tariffs and easing trade — but that the UAE wants a fuller, independent CEPA on top of it. That would mean deeper commitments on AI, investment protection, financial services, digital trade, and mutual recognition of professional qualifications for engineers, lawyers, and similar roles.

It’s early — but exploration is underway: “Our priority now is bringing [the GCC] agreement into force so British businesses can start reaping the benefits as soon as possible,” a UK government spokesperson tells EnterpriseAM. But a consultation on deepening the UAE relationship specifically and opening further prospects for UK firms has also been launched, the spokesperson tells us.

Why a CEPA is worth it despite the GCC agreement

A GCC agreement moves at the pace of its most cautious member — and the UAE is the bloc’s most open economy. “A bilateral CEPA is how it goes further,” geoeconomist and former IMF analyst Celine Bteish tells EnterpriseAM. Its edge, she argues, is in services, data, investment, and mobility.

The sectors in play track where UAE policy is already ahead of the GCC average, BMI Senior MENA Country Risk Analyst Mariette Kas-Hanna tells us: financial and professional services, digital trade, technology and AI, and advanced manufacturing. “A bilateral [agreement] could be more tailored to the UAE's role as a hub for trade, logistics, finance, and multinational regional headquarters,” she says.

Why it matters

A G7 signature is worth more than its tariff lines. The UAE's CEPA network is mostly built around emerging markets — a hedge against a fragmenting global order, Bteish tells us. A UK agreement breaks that pattern — and the move could be strategic. “When a G7 economy signs on the UAE's terms, it validates the UAE as a jurisdiction the West trusts,” Bteish says — a credibility play that Bteish believes pays off commercially over time, even if the initial gain is reputational.

Kas-Hanna sees a UK CEPA strengthening the UAE's hand in future talks with other advanced economies — though she's clear the model won't transfer easily. UAE-EU talks, already underway, are moving slower precisely because they cover a heavier agenda: services, investment, digital trade, energy, procurement, and sustainable development, all at once.

REMEMBER- The UAE's broader CEPA trade hit AED 304.3 bn in 1H 2026, including AED 66.1 bn in non-oil exports — the base the UAE is trying to build on with higher-value partners rather than more volume.

Setting a precedent for other deeper agreements? This G7 alignment could strengthen the UAE’s standing and serve as a precedent for deeper agreements, though Kas-Hanna notes the model won’t be easily replicated. The slow-paced UAE-EU talks demonstrate this complexity, as they cover a demanding agenda that includes services, investment, digital trade, energy, procurement, and sustainable development, according to Kas-Hanna.

What’s in it for the UK?

The economic lift for the UK may prove incremental: UK government figures estimate the wider GCC agreement will add just GBP 3.7 bn to UK GDP by 2040, which BMI estimates at 0.12% of 2040 GDP, suggesting a UAE-specific agreement would yield a modest macroeconomic impact, BMI UK Country Risk Senior Analyst James Bennett tells us.

London’s motives sit outside the spreadsheet. Bennett points to three: locking in GCC investment commitments, demonstrating the UK’s post-Brexit ability to close trade agreements, and building cooperation on labor standards, animal welfare, and women's economic participation. A UAE-specific pact is welcome in that context, he says — but it isn't currently a top UK trade priority.

What's next: The mutual recognition of professional qualifications is the likeliest sticking point — Bennett notes the GCC agreement itself only commits both sides to discuss recognition, not to implement it. Labor and environmental provisions are unresolved too; the UK says those talks continue bilaterally. We’ll be on the lookout for the UAE and the UK taking their consultation a step further toward formal negotiations.