The UAE’s Promising Asia Outreach
- 1 June 2014
The United Arab Emirates and the Republic of China have enjoyed strong bilateral relations for decades. The visit of His Excellency Dr. Sultan bin Ahmed bin Sultan Al Jaber, Secretary of State, to China, recently demonstrates the two countries’ openness toward each other and their mutual desire to strengthen bilateral ties. This was another step taken by the UAE to strengthen its relations with China. During his visit, H.E. Dr. Sultan bin Ahmed bin Sultan Al Jaber stressed that the relationship between the two countries have been consolidated on the basis of mutual interests in economic, commercial, political and social arenas.
The UAE is now among China’s top trading partners and a significant component of non-oil trade with the Middle East and North Africa, with about 60 percent of its exports to this region passing through the UAE. On the other hand, China is the second largest trading partner of the UAE at the moment, where volume of trade between the two countries exceeds around $46 billion a year. This figure is expected to rise to around $100 billion over a few years apart from investments worth billions of dollars.
The interests between the UAE and China, highlighted by H.E. Dr. Sultan bin Ahmed bin Sultan Al Jaber, seem clear on several counts. Both sides have a strong desire to develop economic sectors, including energy. China is the world’s largest consumer of oil and its need for energy is increasing considering its rapid economic growth and improved standard of living. Moreover, China has succeeded in disseminating the renewable energy technology use to a level not recorded in any other country in the next five years. The UAE is one of the biggest investors on energy projects as the country aims to increase its oil output to about 3.5 million bpd. The UAE’s investment in renewable energy is one of the largest in the world and it is home to one of the few cities in the world that rely entirely on clean energy, namely Masdar.
There are other areas of common interest between the UAE and China that include opportunities for cooperation in advanced technology and research and technological development. The two countries have signed several agreements, which create avenues for greater cooperation, including economic, industrial and technical agreements, avoiding double taxation, promotion and protection of investments agreement, and bilateral cooperation in air transport. Also, as part of its membership of the GCC, the UAE is also involved in negotiations to conclude free trade agreement between the GCC countries and China.
The UAE’s interest in China forms part of its focus on the Asian continent. The country seeks to establish a strong and varied relations with countries in the continent as one of its most important goals is benefiting from the continent’s advantages and making itself a promising market for any rising economic power. Asia is the largest continent in terms of area and population and accounts for about a third of global GDP. According to the Asian Development Bank, its economies are now growing at more than 6 percent per annum. Yet aftereffects of the global financial crisis continue to hamper these economies.