UAE–Vietnam Comprehensive Economic Partnership Agreement (CEPA) Enters Into Force

The UAE–Vietnam CEPA has entered into force, significantly deepening bilateral trade and investment ties through tariff liberalization, improved market access, and enhanced economic cooperation. With trade surpassing US$16 billion in 2025, the agreement positions Vietnam as a key manufacturing partner for GCC firms and reinforces the UAE’s role as a regional gateway for Vietnamese and international businesses.

As of February 3, 2026, the Comprehensive Economic Partnership Agreement between the United Arab Emirates and Vietnam (UAE-Vietnam CEPA) has officially entered into force, establishing a comprehensive framework for trade liberalization, investment facilitation, and deeper economic cooperation.

The agreement is designed to eliminate or significantly reduce barriers to trade, enhance regulatory cooperation, and create more predictable conditions for businesses operating in both markets.

UAE–Vietnam bilateral economic relations

The entry into force of the CEPA builds on a period of strong momentum in UAE–Vietnam economic relations. Vietnam has emerged as the UAE’s largest trading partner within the ASEAN region, reflecting its role as a major export-oriented manufacturing hub and a fast-growing consumer market of more than 100 million people.

Institutional and private sector engagement has intensified alongside trade growth. Recent high-level business discussions involving the Sharjah Chamber of Commerce and Industry and Vietnamese trade and industry representatives have highlighted the practical role of the CEPA in facilitating B2B partnerships. These engagements have focused on sectors such as logistics and supply chains, pharmaceuticals, smart technologies, food production, and advanced manufacturing, with an emphasis on value-added cooperation rather than transactional trade alone.

Investment ties further reinforce the strategic nature of the relationship. Emirati investments in Vietnam have expanded across energy, port infrastructure, logistics, and real estate, while Vietnamese firms increasingly view the UAE as a gateway to wider regional markets.

Overview of the UAE–Vietnam CEPA

A central pillar of the CEPA is tariff liberalization. Under the agreement:

• More than 90 percent of UAE exports to Vietnam will benefit from eliminated or substantially reduced tariffs, covering 99 percent of the total value of Emirati exports; and
• Vietnam will see tariff reductions on 95 percent of its product categories exported to the UAE, likewise covering 99 percent of the total value of these imports.

Beyond goods trade, the CEPA establishes a platform for broader economic collaboration. It places particular emphasis on unlocking investment opportunities in strategic sectors such as renewable energy, technology, agriculture, logistics, and advanced manufacturing. By strengthening market access and encouraging private sector collaboration, the agreement aims to support joint ventures, technology transfer, and long-term industrial partnerships, reflecting the complementary strengths of the two economies.

The UAE–Vietnam CEPA also forms part of the UAE’s wider CEPA program, launched in 2021 to accelerate non-oil trade growth through bilateral agreements with high-growth and strategically positioned economies. With agreements concluded with more than 30 countries globally and 15 already in force, the Vietnam CEPA reinforces the UAE’s strategy of embedding itself more deeply into global value chains while expanding opportunities for domestic businesses abroad.

Trade performance and growth trajectory

Bilateral trade between the UAE and Vietnam has recorded strong momentum over the past two years, providing a solid foundation for the implementation of the CEPA. Non-oil trade reached US$12.6 billion in 2024, reflecting steady growth despite global economic uncertainty. This upward trajectory accelerated sharply in 2025, with bilateral trade surpassing US$16.05 billion, representing year-on-year growth of approximately 27.4 percent.

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The crossing of the US$16 billion threshold is significant, not only in absolute terms but also as an indicator of the deepening structural integration between the two economies. Vietnam has consolidated its position as the UAE’s largest trading partner within the ASEAN, underscoring its growing importance in the UAE’s Asia-focused trade strategy.

The scale and pace of growth highlight Vietnam’s role as both a high-growth consumer market and a manufacturing base closely integrated into regional and global supply chains.

This expansion has been driven by rising trade volumes alongside increasing diversification in traded goods. The UAE’s non-oil exports to Vietnam recorded particularly strong growth in 2025, reinforcing Vietnam’s importance as a destination for Emirati products and as a platform for deeper engagement with ASEAN supply chains. Key export categories have benefited from improved logistics connectivity and growing demand linked to Vietnam’s export-oriented industrial base.

At the same time, Vietnamese exports to the UAE have continued to expand, supported by the UAE’s role as a regional trade, logistics, and re-export hub serving markets across the Middle East, Africa, and South Asia. The sustained double-digit growth in bilateral trade reflects a maturing commercial relationship that is moving beyond volume-driven expansion toward greater value addition, supply chain integration, and long-term strategic alignment. As the CEPA’s tariff and market access provisions take full effect, this growth trajectory is expected to become more resilient and increasingly diversified.

Tariff reductions and market access provisions

A core feature of the UAE–Vietnam CEPA is the elimination or significant reduction of tariffs on the majority of traded goods. From a commercial perspective, the tariff reductions have direct and immediate implications for exporters, manufacturers, and distributors in both markets. Lower duties reduce landed costs, improve supply chain efficiency, and support longer-term sourcing and investment decisions. For manufacturers, the agreement increases the feasibility of integrating bilateral trade into regional production networks, while distributors benefit from improved margins and more competitive pricing structures.

In the short to medium term, the sectors most likely to benefit include industrial goods, food and agricultural products, electronics, machinery, logistics-related inputs, and energy-related equipment. Over time, these gains are expected to extend to higher value-added segments as companies leverage improved market access to deepen supply chain integration, establish local partnerships, and expand their regional footprint under the CEPA framework.

Implications for Middle East and International Businesses

The entry into force of the UAE–Vietnam CEPA creates clear strategic opportunities for businesses across the Middle East and beyond. For GCC-based companies, Vietnam offers an increasingly attractive manufacturing and export base, combining competitive production costs, a large skilled labor force, and deep integration into Asian and global supply chains. Preferential tariff access under the CEPA further strengthens Vietnam’s appeal as a platform for serving both the Vietnamese domestic market and wider ASEAN economies.

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At the same time, Vietnamese firms stand to benefit from using the UAE as a regional gateway. The UAE’s advanced logistics infrastructure, free zones, and re-export capabilities enable Vietnamese exporters to efficiently access markets across the Middle East, Africa, and South Asia. The CEPA enhances this role by reducing trade frictions and supporting long-term commercial partnerships with regional distributors and investors.

From a broader strategic perspective, the agreement supports supply chain diversification and more resilient regional market entry strategies. Companies seeking to reduce concentration risks can leverage Vietnam as part of a multi-country production strategy, while using the UAE as a centralized hub for regional distribution and value-added activities. For international businesses, the CEPA reinforces the UAE–Vietnam corridor as a commercially viable route linking Asian manufacturing with high-growth consumer markets across multiple regions.

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