Name: MARIENELLA P.
NAVARRO
Course & Section: BSED MATH 1-A
MARKET INTEGRATION
Introduction
The United Arab Emirates (UAE) is a federation comprising seven emirates
located on the Arabian Peninsula, which is bordered by Saudi Arabia to the south
and west and Oman to the southeast. Established in 1971, the UAE has transformed
from a desert area dependent upon pearl diving and fishing to one of the most
rapidly developing economies in the world. The capital of the country is Abu Dhabi,
while Dubai is the financial and commercial center of the nation. The UAE is
synonymous with rapid economic development, a high standard of living, and a
global trade and logistics hub location in the world.
The economy of the UAE is highly diversified and the UAE is delinked from an
oil-dependent economy through its tourism, finance, real estate, and technology
sectors. The government of the UAE is also pro-business, with free-trade zones and
international trade agreements forum to enhance its market integrations.
Market Intergration
The United Arab Emirates (UAE) is committed to market integration and is utilizing
various measures to further its engagement in the world economy. This article
assesses the level of the UAE's involvement in the world market by considering trade
barriers, government action and economic development.
Trade Barriers
According to the [Link], Middle East Briefing, and The International Trade
Council, UAE has an open trade policy with low tariff rates and few non-tariff
barriers.
The general import duty rate is 5 percent, unless the product class attracts a higher
rate such as alcohol and tobacco. Non-tariff barriers include import permits and
document requirements, as well as private sector stipulations for some sectors such
as insurance, banking, telecommunications, and transport sector.
Furthermore, while free investment ownership is allowed up to 100 percent
in various free zones, the bulk foreign direct investment in businesses historically
was required to have a local agent or sponsor in the mainland; however, such
practices have been relax in some sectors, in recent years.
Government Policies
The UAE has taken active steps and pursued a number of policies designed
more specifically to diversify its economies, especially away from oil. The primary
vehicle for this strategy includes signing Comprehensive Economic Partnership
Agreements (CEPAs) with countries including India, Indonesia, Israel, Turkey, and
Australia. The intent of these agreements is to remove tariffs and ease customs
processes to establish cooperation and economic development. For example, the
UAE-Australia CEPA, signed in November 2024, removed tariffs on over 99 percent of
Australian exports to the UAE to establish greater trade opportunities between the
two regions (The Australian, 2024).
Moreover, the UAE has created multiple zones of free trade with benefits like
100% foreign ownership, zero corporate taxes, and full repatriation of profits. These
trade zones have facilitated international businesses to conduct their trade in the
UAE and have confirmed its status as a global trade hub (FasterCapital, 2024).
Economic Development
The UAE's focus on trade liberalization has truly aided its economic
development. In 2024, the country reached its record level of non-oil trade at 3
trillion dirham (about $817 billion), 14.6% greater than that of the previous period.
This was also aided by a jump of 42.3% or about one-quarter share of the total UAE
non-oil exports, in exports to CEPA partner countries (Reuters, 2025).
The UAE's strategic location and logistics capabilities have established it as a
key node for global trade. New state-of-the-art ports and free trade zones have
enabled international trade to flow more smoothly, signaling to multinational
corporations that the UAE welcomes them to establish and operate. This key area
has enhanced competition and trade in the region.
Conclusion
By reducing trade barriers, introducing progressive government policies, and
investing in economic diversification, the UAE has effectively accomplished the task
of facilitating market integration and engaging as a player in the global market. Such
efforts have enabled the UAE to have a more resilient economy and created the
ability for international companies to have a more competitive business
environment.
