The United States and the UAE have agreed to begin negotiations for a bilateral trade agreement that would reduce tariffs on the Gulf state’s steel and aluminum industries, according to Reuters.
The sources added that Emirati officials discussed the possibility of concluding a trade agreement with their American counterparts during President Donald Trump’s two-day visit to Abu Dhabi last month.
Like other countries, the UAE was affected by Trump’s 10% basic tariff on its exports to the United States, and its steel and aluminum products were affected by a 25% tariff, which the Trump administration doubled to 50%.
Although the UAE is a major oil producer, its steel and aluminum products are important non-oil exports. In 2024, the UAE was the second-largest exporter of steel and aluminum to the United States, accounting for 8% of total US consumption, according to official data.
According to Reuters, the sources reported that US officials responded positively, although it remains unclear when talks will begin.
Two sources said Washington is likely to negotiate a limited deal that will fall short of a comprehensive free trade agreement. However, the sources said that any agreement, if reached, would likely remain called the Comprehensive Economic Partnership Agreement (CEPA), the same trade name the UAE uses for its other trade agreements.
The UAE is Washington’s largest trading partner in the Middle East, according to the UAE’s Ministry of Foreign Affairs. Bilateral trade was valued at $34.4 billion in 2024, according to US trade data, with the US enjoying a $19.4 billion surplus.
