GCC–ASEAN Free Trade Talks: What a Deal Would Mean for UAE Businesses in Southeast Asia

We illustrate what a GCC–ASEAN free trade agreement would mean for UAE businesses: Thailand access, multi-country sourcing, one rulebook across 10 markets.

When the Gulf Cooperation Council (GCC) and the Association of Southeast Asian Nations (ASEAN) discuss a bloc-to-bloc free trade agreement, they are, in commercial terms, talking largely about one country.

The UAE accounted for 46 percent of GCC–ASEAN trade in 2023, according to Gulf Research Center analysis, comfortably ahead of Saudi Arabia’s 31.4 percent. That places UAE businesses in the centre of the opportunities created by any deal reached.

GCC and ASEAN leaders agreed to explore closer economic ties at their first summit in Riyadh in October 2023. This was built upon the following summit in Kuala Lumpur in May 2025 where they adopted a joint declaration that, among other commitments, called for a joint feasibility study on a GCC–ASEAN FTA and for the two blocs to begin free trade discussions. That is where things stand at present, no text, terms of reference or timetable yet exist.

That gives UAE businesses time to think through what a bloc-to-bloc trade deal would mean for them and how they can practically prepare for it.

The UAE’s ASEAN access is already largely built

The UAE has spent the last three years connecting to the economy of Southeast Asia. Through its Comprehensive Economic Partnership Agreement (CEPA) programme, launched in 2021, it now has agreements in force with four ASEAN members (Indonesia, Cambodia, Malaysia and Vietnam) and a fifth, the Philippines, signed and awaiting entry into force. Together these cover the UAE’s largest ASEAN trading partners.

Vietnam alone recorded more than US$16 billion in two-way non-oil trade in 2025, up 27.4 percent on the year.

The main gap that would be covered by a bloc-bloc deal here is Thailand. It is one of Southeast Asia’s largest economies. The UAE has been negotiating a CEPA with Thailand since 2023 with nothing yet agreed.

What a bloc deal adds

• Origin cumulation: Bloc agreements typically allow inputs and processing carried out across several partner economies to count together toward originating status. That would let a UAE manufacturer combine value-added from, say, Vietnam, Malaysia and Indonesia and still claim preferences — treating ASEAN as one sourcing area rather than five separate rulebooks. However, until a text emerges this is what such deals often enable, not yet a definite outcome.
• Thailand: If the bilateral CEPA stays unfinished then a free trade agreement would open up the single most commercially meaningful gap for UAE businesses.
• One rulebook: Common customs procedures, digital-trade rules and services commitments across all ten ASEAN markets, in place of a patchwork of bilateral texts.
• An investment channel: The Kuala Lumpur declaration foregrounded two-way investment, and the Gulf’s distinctive asset is sovereign and state-linked capital. There is already movement in this sector what could be formalised by a deal. For example, Masdar, a UAE state-owned renewable energy and green hydrogen firm – has recently signed a power-purchase agreement in December 2025 for a 200 MW floating solar plant at Malaysia’s Chereh Dam.

Sector exposure

The gains of a deal would feel unevenly across different sectors. Where a business is in this landscape will determine where it should make use of the opportunity.

• Logistics and ports: stand to gain from smoother, more predictable movement of goods between the two regions, reinforcing the UAE’s role as the transshipment link between the Gulf and Southeast Asia.
• Goods exporters: aluminium, petrochemicals and plastics — care most about tariff access, and above all about Thailand, the one large market a bloc deal would open that the bilateral network has not.
• Halal food and beverage and Islamic finance: would benefit from wider recognition of UAE certification and standards across ASEAN, extending the kind of cooperation the UAE first built into its Indonesia agreement.
• Renewables and sovereign capital: are the clearest winners on the investment side — the Masdar model of Gulf-backed clean-energy projects in ASEAN, scaled and de-risked.

Timeline and what to watch

At the present time, the feasibility study is being conducted, and its outcome will determine whether further talks go ahead. If they do, terms of reference (ToR) defining scope and modalities would follow, then formal rounds. Once the ToR are agreed then formal talks can begin.

We saw this process proceeded quite quickly recently with the India–GCC track is the template: after nearly two decades dormant, the two sides signed a ToR on February 5, 2026 and formally launched negotiations on 24 February. But with the GCC also negotiating with India and, bilaterally, with Malaysia, a concluded, in-force GCC–ASEAN agreement is realistically several years away, if it happens at all.

What companies can do now

For UAE businesses looking to prepare in advance for any future deal two low-cost steps are worth taking before any text exists. First, identify the products and services that would gain in markets not yet covered bilaterally (as outlined above) — Thailand first. Second, start keeping supplier and input records at country-by-country level of detail now, since any cumulation benefit will be claimable only by firms that can document where inputs and processing occurred across ASEAN.

Key takeaways

A GCC–ASEAN deal is still distant but the shape it would take is discernible from other similar bloc-to-bloc agreements. The firms best positioned to benefit are those operating across several ASEAN markets rather than a single corridor and firms can begin to prepare to take advantage of the benefits. The UAE’s August 2025 request to accede to the CPTPP — whose members include Brunei, Malaysia, Singapore and Vietnam, is one wildcard. It could reshape the UAE’s Southeast Asian access ahead of anything the two blocs agree.

How Dezan Shira and Associates can help

Much of the value to come out of new trade agreements goes to firms that prepare early. Dezan Shira & Associates supports foreign investors across both the Gulf and Southeast Asia. Our teams advise on market entry, trade agreements and rules of origin, cross-border investment structuring, and regulatory and tax compliance, helping companies navigate an increasingly connected GCC–ASEAN landscape.

To discuss your strategy visit www.dezshira.com.

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