China has been among the UAE’s top trading partners for the past five years, with an expansion in bilateral investment and trade. The world’s largest container operator, China’s COSCO Shipping Limited, has selected the port of Khalifa as its base for operations in the Middle East. The UAE has fully supported China’s Belt and Road Initiative, establishing projects such as the Dubai Mercantile Market, the Yiwu UAE Market and the China-UAE Industrial Capacity Demonstration Zone with the participation of Chinese capital and enterprises.
The United Arab Emirates (UAE) is an actor in China’s industrial relations with the Middle East, especially with the Arab Gulf region.
The UAE has supported China’s ambitions along the Belt and Road (BRI), as well as other foreign policy objectives such as South-South cooperation, i. e. technical cooperation between emerging and southern countries in the area of resources and generation. Meanwhile, the bilateral industry is strong, with Chinese exports to the UAE showing tremendous growth. This in turn has fostered an environment where partnerships with Chinese companies can expand into high-potential sectors such as energy, infrastructure and money generation (FinTech).
China and the United Arab Emirates first established diplomatic relations in 1984. While China has an embassy in Abu Dhabi and a consulate general in Dubai, the United Arab Emirates has a consulate general in Hong Kong and an embassy in Beijing. China and the UAE have long been close partners, participating extensively on the economic, political and cultural fronts.
High-level industry has been the basis of bilateral relations. The bilateral industry between China and the UAE reached new highs in 2021, surpassing US$75. 6 billion. population that operates basically in the infrastructure and energy sectors. The UAE is also China’s second largest economic spouse in the Middle East, after Saudi Arabia.
In 2018, Chinese President Xi Jinping paid a state to the UAE, making history as the first Chinese head of state in the country in the past 29 years. This helped make bilateral relations a “comprehensive strategic partnership. “
The non-oil industry of China and the UAE grew by 27% in 2021 compared to last year, with China ranking first among the country’s most sensible partners and accounting for 11. 7% of its total foreign industry. The price of the non-oil industry between the two countries US$ 57. 71 billion.
According to recent estimates, the reduction of price lists and non-tariff barriers, as well as increased infrastructure, is expected to continue to animate China’s industry with countries participating in the BRI in the coming years. On the other hand, the World Bank believes that these countries continue to subindustrialize, either among themselves and with the rest of the world, despite the significant expansion of industry between China and British partners.
In July 2022, China’s exports to the UAE increased $1. 78 billion (53. 2%) to $5. 12 billion, as of July 2021, while its imports reached $3. 94 billion. $350 million), semiconductor devices ($149 million), motor vehicle parts and accessories ($107 million) and video displays ($95. 3 million). US$160 million) and subtle oil (US$92. 3 million) were the maximum products imported.
In July 2022, an increase in shipments of computer products (39. 3%), vaccines, blood, antisera, toxins and crops 43. 8%) and lighting fixtures (77. 2%), the main contributor to the year-on-year growth of China’s exports in the UAE market.
The UAE and China are mulling over a “frame paintings deal” to collaborate on many projects. In addition to the UAE-China Trade Committee to cooperate in the fields of logistics, transportation, industry, generation, synthetic intelligence and energy, renewable energy and food. Security, as well as education for small and medium-sized enterprises, the two countries intend to work in combination in the fields of innovation, generation movement and economic diversification (SMEs).
China’s COSCO Shipping Limited, the world’s largest container operator, also selected the Port of Khalifa in Abu Dhabi as the hub of its Middle East operations. It also intends to increase the annual capacity of port services to 6 million TEU, it is the largest container loading terminal in the region. The inventory is expected to attract more investors from Eastasia to khalifa port.
The China-UAE partnership has also witnessed the expansion of cross-border e-commerce and the progression of bilateral industry through e-commerce.
Despite the negative effect of COVID-19 on global economies, foreign direct investment (FDI) in the UAE increased by as much as 4% (or $20. 7 billion) in 2021 compared to 2020; the total amount of FDI received through the UAE was approximately USD 171. 6 billion. To protect and publicize investments, the UAE has signed more than 106 agreements with its trading partners.
According to figures from the Chinese Embassy in the UAE, China’s overall direct investment in the UAE increased by 171% over last year to reach AED 2400 million ($650 million) in January-September 2019. The amount accounted for 54% of the Chinese. investments. investment in the 22 members of the Arab League.
According to data from the United Nations Conference on Trade and Development (UNCTAD), FDI inflows into the UAE increased overall by 32. 8% to $13. 8 billion in 2019, the highest point since 2007. A legal amendment implemented by the UAE in September 2020 eliminated the needs that corporations outside the emirates’ loose zones have most of their shares through UAE citizens or their businesses.
A closer relationship between the two countries is expected for the UAE to serve as a hub for China in the region and inspire investment, as the primary infrastructure and power generation projects already underway will be complemented through new joint projects in trade, logistics and green area creation. . the emirates.
For the past 10 years, China and the UAE have investigated joint ventures (JVs) in ports of loose industrial zones, independent export-oriented economic zones of construction, and establishment of commercial projects, adding fourth-generation industries and other high-tech industries. In addition, China and the United Arab Emirates intend to expand their cooperation through joint investments in the Pacific islands and the African continent.
The two countries should deepen their relations in the area of monetary facilities by allowing the respective bank branches to assist bilateral industry and investment and by strengthening collaboration between the Shanghai Stock Exchange (SSE) and foreign monetary centers in the Uae. The Belt and Road Exchange established in Abu Dhabi in 2018, for example, was designed to become a major platform for raising foreign capital, helping Chinese corporations, foreign corporations and foreign organizations finance their investments, adding those of the Silk Road. Belt network. To continue Abu Dhabi’s partnerships with the Chinese government, Abu Dhabi Global Market (ADGM) followed up on the agreement by building its first workplace for foreign representatives in Beijing.
ADGM and Hong Kong Securities and Exchange (HSE) recently made the decision to work together to encourage and promote innovation at monetary facilities in Hong Kong and the United Arab Emirates. Together, the two governments hope that the monetary sector in their two national markets and create thriving ecosystems for FinTechs.
An example of a sector is provided by the status quo of the “China-Arab Countries Partnership Program in the Field of Science and Technology, aimed at defining other spaces for cooperation in the fields of education, science and technology”. Young Emirati scientists will have the opportunity to conduct short-term clinical studies in China and be informed about new technologies through the program.
Without a doubt, the Gulf region plays a vital role in the BRI due to its geographical location at the crossroads of Europe and Asia. The United Arab Emirates is well positioned to lead the BRI countries in the Gulf and consolidate its position as the advertising hub of the region and the gateway to Africa. China is already the largest economic spouse of the UAE before joining the BRI, with a bilateral industry between the two countries achieving US$50 billion in 2019. The UAE is ahead of its neighbors and is expected to retain this merit. under the BRI. More than any other country in the Gulf, the UAE has benefited from import, export and re-export opportunities. The United Arab Emirates has the most established and varied seaports, airports and loose zones in the region due to significant investment in those infrastructure designs. All of this is supported by a strong legal and regulatory framework that includes not unusual legal jurisdictions in the “offshore” jurisdictions of the Dubai International Financial Center (DIFC) and the Abu Dhabi Global Market (ADGM), where some of the normal civil courts where the region is located.
Dubai DBX Airport has been the world’s busiest airport in number of foreign passengers since 2014, when it surpassed London Heathrow. Other vital airports are Abu Dhabi Airport, which serves as a base for Etihad Airways, the national airline of the United Arab Emirates, and Dubai. Al Maktoum Airport, which is basically used for shipping flights to Dubai (including those operated through China Airlines Cargo and Emirates Sky. Cargo).
Despite the daily number of aircraft flying between the UAE and the rest of the world, the UAE imports 78. 1%, exports 92. 7% and re-exports 86% by sea. With more than 14 million TEUs treated in 2019, Dubai’s Jebel Ali Port is lately the eleventh busiest container port in the world (in container traffic). By far, this makes it the busiest port in the Gulf region and the third busiest foreign port outside of China.
One of the largest deep-water ports in the world, along with the port of Jebal Ali, is the port of Khalifa in Abu Dhabi. Although all six stages of the planned structure are expected to be completed by 2030, the port is now consistent with the national one. The Chinese terminal COSCO Shipping Ports Abu Dhabi (CSP) is a component of the port. The CSP terminal, which has a domain of 275,000 meters, serves as a regional hub for its global network of 36 ports. The CSP terminal can accommodate giant vessels weighing more than 20,000 TEUs and has a nominal capacity of 2. 5 million TEU in line with the year.
Khalifa Port is a component of the larger Khalifa Abu Dhabi Industrial Zone (KIZAD), which extends to the sea on a reclaimed island and extends over a domain of more than 400 square kilometers and serves the Emirates of Dubai and Abu Dhabi. The infrastructure for the movement of goods through the UAE’s seaports, as well as its loose commercial and industrial zones, provide a solid foundation on which the UAE will seek to expand its role in foreign trade and industry and be a key member of the BRI. As a result, although the UAE connects the world through the air, it is also a major player in the BRI.
Most likely, the UAE’s participation in the BRI will go beyond simply facilitating the movement of goods by supporting the physical infrastructure of trade. The fields of education, science, technology, culture, tourism, area exploration and synthetic intelligence are of great interest to China. The UAE is also at the forefront of those initiatives, and Abu Dhabi and the Emirates of Dubai serve as regional hubs for the FinTech industry. This role is expected to grow as the UAE seeks to leverage the virtual component of the BRI and its more potent ties with China.
On this front, China’s Dubai International Financial Center (DIFC) and Jiaozi FinTech Dreamworks (Jiaozi) signed a Memorandum of Understanding (MoU) in July 2020. The BRI’s progress through FinTech collaboration in the fields of blockchain, synthetic intelligence, big knowledge, and cloud computing in the middle of this memorandum of understanding. The agreement with Jiaozi aims to provide reciprocal benefits to the respective jurisdictions of the two nations, with an emphasis on reciprocal market access. The DIFC has established the largest intact ecosystem in the region.
Overall, the UAE is poised to lead THE BRI’s investment and trade, thanks to virtual and technological advances, as well as facilitating the genuine movement of products. In addition, more than 4000 Chinese corporations already operate in the United Arab Emirates, a country that serves as an advertising gateway for another hundred million people in the Arabian Gulf region.
After the UAE joined the BRI, the Dubai Traders Market was one of the first core projects to be announced. The market is located on the site of Dubai Expo 2020. The site, which is a component of the Jebal Ali Free Zone (JAFZA), covers a domain of approximately 800,000 square meters. JAFZA’s regulatory framework, which allows one hundred percent foreign ownership and other free zone benefits for the re-export of goods, greatly benefits the market.
First announced in 2019, the first phase of this assignment evolved through Dubai port operator DP World into a 70/30 joint venture with Zhejiang China Commodity City Group (CCC Group). The first phase of structure consisted of replicating the creation of the “Yiwu market”, which is driven through the “Yiwu China Commodity City” through the CCC group, with a Chinese investment of 2. 4 billion dollars. The Yiwu market in the United Arab Emirates, which covers more than 200,000 square meters, has more than 1600 showrooms and 324 customs warehouses. It aims to give traders and businesses around the world access to wholesale prices with reduced supply chain expenses and undoubtedly contributes to and aligns with BRI’s goals. At the time of the market announcement, another contract was also signed for a US$1 billion allocation founded in Dubai to import, process, package and export agricultural, marine and vegetable basket products, between Chinese investors and the Dubai-based company. logistics company DP World.
Finally, the Jiangsu Provincial Overseas Cooperation and Investment Company is one of the major entities of the China-UAE Industrial Capacity Cooperation Demonstration Zone structure in KIZAD (JOCIC). The allocation includes a total of 80,000 square meters of infrastructure in a footprint of 220,000 square meters. Since its official launch in 2019, the allocation has earned investments from some 20 Chinese corporations totaling more than $1600 million. In addition, founded on a 50-year Abu Dhabi port cooperation agreement, the allocation aims to expand a 2. 2-square-kilometer production led by a possible long-term expansion, based on a 50-year Abu Dhabi port cooperation agreement.
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