The UAE has activated its Comprehensive Economic Partnership Agreement (CEPA) with Azerbaijan, marking a new phase in bilateral trade and investment ties. The agreement took effect on Tuesday and signals a push to deepen economic cooperation across sectors.
The pact brings tariff cuts and market access while also presenting business opportunities for UAE investors. As mentioned by the UAE Minister of Foreign Trade, the agreement would help develop transport relations and improve diplomatic ties between the two countries. Companies operating out of the UAE find that their business opportunities in Azerbaijan are more lucrative due to Azerbaijan's strategic location.
It is expected that sectors such as logistics, renewables, and manufacturing can see considerable development. The agreement facilitates cooperation in the services sector, thereby allowing companies to participate in finance, consulting, construction, and professional services.
For Azerbaijan, this was the first-ever trade agreement with a special focus on the services sector, providing the UAE enterprises with an opportunity to benefit.
The CEPA builds on a sharp uptick in trade between the two nations. Non-oil trade has grown 31.4% over the past two years, crossing $2.2 billion in 2025. Officials see the agreement as a catalyst for further accelerating this trajectory.
Azerbaijan continues to be the largest Arab trading partner of the UAE in the Caucasus region, accounting for 40% of the UAE's total trade with the broader MENA region. UAE’s investments in Azerbaijan already cross the $1 billion mark.
Al Zeyoudi, the UAE’s Minister of Foreign Trade, said that this accord is “a defining moment in our bilateral relations.” According to him, Azerbaijan's geographical location within the North-South Corridor plays a vital role in sustainable development.
Azerbaijan CEPA is also part of the UAE’s international partnership development strategies aimed at boosting trade. Their plans include increasing their trade activities to $1 trillion from Dh3.67 trillion and doubling their economy by 2031.
It is expected that the deals will enable efficient supply chain management, especially as new economic sectors grow in the UAE.