UAE announces new tax agreements with Kuwait to develop $12.2bn trade relationship
In an attempt to further strengthen their already strong commercial and political ties, the United Arab Emirates and Kuwait have just finalized tax agreements.
Concurrent with this change is an increase in commerce between the two countries, which reached AED44.8bn ($12.2bn) in 2023. Both parties are eager to see more cross-sector cooperation, especially in the financial industry, and this is evident in the growing alliance.
The dedication of both nations to strengthening investment and commercial relations is emphasized by several agreements and MoUs. Among them are the accords that their respective ministries of finance just inked at the 2024 World Governments Summit. Particularly noteworthy are the accords that deal with the prevention of tax evasion and avoidance and the elimination of capital and income double taxation. The free flow of cash between Kuwait and the United Arab Emirates is one goal of these accords, which seek to promote economic and financial integration.
In the financial sector, significant collaborations have been forged, such as the cooperation agreement between the Securities and Commodities Authority of both countries. Moreover, a tripartite cooperation agreement involving the Abu Dhabi Securities Exchange (ADX), the Kuwait Stock Exchange (KSE), and the Kuwait Clearing Company (KCC) was inked in February 2022. These agreements have led to a notable increase in Kuwaiti shareholders in publicly traded companies and licenses granted to Kuwaiti nationals for economic activities in the UAE.
Efforts to promote innovation and effective corporate governance practices have also been prioritized. Collaborations between the UAE Ministry of Finance and the Sabah Al-Ahmad Center for Giftedness and Creativity aim to foster an innovative environment and enhance cooperation in innovation-related initiatives. Similarly, partnerships between the Governance Institute for Corporate Governance and the Kuwait Capital Markets Authority seek to elevate corporate governance standards among listed companies in Kuwait.
These initiatives are part of broader efforts to strengthen bilateral relations and foster greater economic cooperation between the UAE and Kuwait. Investments between the two nations have seen significant growth, with the UAE serving as a key destination for Kuwaiti investments and vice versa. The trade volume between the two countries reached AED44.8bn ($12.2bn) in 2023, indicating a steady increase and highlighting the promising prospects for further collaboration in the future.
