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UAE and Bahrain Strengthen Economic Ties with New Investment Protection Agreement



On May 8, 2025, the United Arab Emirates (UAE) and Bahrain officially implemented a new Investment Promotion and Protection Agreement.  This pact aims to provide a comprehensive legal framework that ensures full protection for investments and strengthens mutual investor confidence by guaranteeing fair and equitable treatment and providing clear mechanisms for dispute resolution.  


The agreement underscores the importance of enhancing cooperation between the two countries in areas related to digital trade, including data protection, privacy, cybersecurity, intellectual property rights, and electronic signatures and authentication.  It also promotes the exchange of best practices and the development of technical capacities.  


Bahrain's Minister of Finance and National Economy, Shaikh Salman bin Khalifa Al Khalifa, emphasized the significance of this agreement, stating that it opens new avenues of cooperation with the UAE, reflecting the strong and longstanding fraternal relations between the two countries.  He highlighted that such bilateral agreements play a vital role in advancing joint cooperation in line with the visions and aspirations of the top leaderships of both nations.  


Mohamed bin Hadi Al Hussaini, UAE Minister of State for Financial Affairs, noted that the agreement's entry into force reflects the shared will to deepen bilateral economic relations.  He added that it marks a new milestone on the path toward greater Gulf economic integration and demonstrates a flexible and forward-looking response to changes in the regional and global economic landscape.  


The implementation of this agreement is expected to enhance investor confidence by providing clear mechanisms for dispute resolution and ensuring fair treatment of investments.  It also aims to facilitate the free movement of funds and protect investors from sudden government takeovers or unfair treatment, thereby creating a more predictable and secure investment environment.  


This development reflects the strong fraternal ties and the growing economic partnership between the UAE and Bahrain.  It reaffirms their commitment to enhancing investment cooperation in a way that serves the interests of investors from both sides and supports the sustainable development goals of both countries.

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