UAE Enhances Its Global Development Stance Through Belt And Road Initiative Participation

The United Arab Emirates (UAE) has become a significant player in global and regional development, thanks to its visionary leadership, strategic location, and favourable business environment. This has positioned the UAE as an influential economic force, particularly in supporting major global initiatives like China's Belt and Road Initiative (BRI), launched by President Xi Jinping in 2013.

The UAE's active participation in the BRI underscores its commitment to economic development and international cooperation. The ninth summit of the BRI will be held in Hong Kong on 11-12 September under the theme "Building a Connected, Innovative and Green Belt and Road." The UAE's strong ties with China and Hong Kong highlight its dedication to these goals.

As a regional economic powerhouse, the UAE continues to make significant contributions to the initiative. The country has invested US$10 billion in the UAE-China Joint Investment Cooperation Fund to support BRI projects in East Africa. In 2018, it signed 13 memorandums of understanding (MoUs) with China to invest in various areas within the UAE.

Recent data from the Chinese Ministry of Foreign Affairs showed that during the first half of 2024, trade between the UAE and China reached US$50.108 billion. This included US$18.66 billion in UAE exports and US$31.448 billion in imports from China. The two countries aim to reach US$200 billion in trade volume by 2030.

The volume of non-oil foreign trade between the UAE and China reached AED296 billion (US$81 billion) last year, growing by 4.2 percent compared to 2022. This solidified China's position as the UAE's top trading partner for non-oil trade, accounting for 12 percent of that trade.

Economic Ties with Hong Kong

The UAE's relations with Hong Kong are also crucial, especially within the context of trade, finance, and logistics. In 2022, total non-oil trade between the UAE and Hong Kong reached US$12 billion, marking a growth of nearly 50 percent over ten years. Foreign Direct Investment (FDI) from Hong Kong into the UAE amounted to US$2.1 billion.

Hong Kong serves as a gateway for UAE companies to access Chinese markets and other parts of Asia. Both regions are major financial centres with significant cooperation in banking, insurance, and capital markets.

Investment Flows

Between 2003 and 2023, UAE investment flows into China totalled US$11.9 billion across sectors such as telecommunications, renewable energy, transport and storage, hotels and tourism, and rubber. During this same period, Chinese investments into the UAE amounted to US$7.7 billion.

Non-Oil Trade Growth

Data for the first half of 2023 revealed that non-oil trade between the UAE and BRI countries reached US$305 billion. This accounted for 90 percent of the UAE's non-oil trade during that period and grew by more than 13 percent compared to the first half of 2022.

Around 88 percent of imports from BRI countries represent 94 percent of non-oil exports from the UAE to these nations. Additionally, 92 percent of re-exports go to these countries.

Diplomatic Milestones

This year marks four decades since diplomatic relations were established between China and the UAE in 1984. Over this period, there has been an impressive increase—800-fold—in trade volume between both nations.

"The Belt and Road Initiative aims to connect Asia, Europe, and Africa through land and maritime routes," said a spokesperson from China's Ministry of Foreign Affairs.

The ninth edition of this summit coincides with celebrations marking this milestone relationship between China and the UAE.

The active involvement of the UAE in global initiatives like BRI reflects its firm commitment to sustainable economic growth through international cooperation. As an influential regional economic powerhouse, it continues making valuable contributions towards creating a more interconnected world.

With inputs from WAM