The move guarantees further access to what is now the world’s second-largest economy. In return, Chinese businesses in the UAE gain an important platform from which they can access vast emerging markets in the Gulf region, whose seven nations alone total close to 100 million people.
In July, His Highness Sheikh Mohammed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi and Deputy Supreme Commander of the UAE Armed Forces, witnessed the signing of numerous agreements and memoranda of understanding between a number of Emirati and Chinese private businesses in the energy, transportation and agriculture sectors during an official visit to the nation, his second in four years. Similar agreements were also signed in 2018 during a reciprocal visit to the UAE by President Xi Jinping.
It’s not exactly a new relationship. More than 4,000 Chinese companies already operate in the UAE. Non-oil trade between the two countries exceeded $53.3 billion in 2017. Bilateral trade has grown an incredible 800-fold since 1984, and it is expected to reach $70 billion by 2020. In 2000, the Hong Kong Trade Development Council chose Dubai for its regional office.
And the relationship goes even further back. Archaeologists recently found 700-year-old Chinese pottery in excavations of emirate sites.
Today, common interests between the two nations include areas such as education, science, technology, culture, tourism, space and artificial intelligence. In April, a 60-million square foot “Traders Market,” an international station for the BRI, was announced for Dubai, opposite the Expo 2020 site. The market will see an investment of $2.4 billion to store and ship Chinese products to the world.
In December 2018, China’s COSCO Shipping Ports and Abu Dhabi Ports inaugurated the CSP Abu Dhabi Terminal at Khalifa Port, positioning Abu Dhabi as the regional hub for COSCO’s global network of 37 ports. Abu Dhabi Ports also has a 50-year agreement with the Chinese Jiangsu Provincial Overseas Cooperation and Investment Company to develop a 2.2 square kilometer China-UAE Industrial Capacity Cooperation Demonstration Zone at nearby Khalifa Industrial Zone Abu Dhabi to attract even more Chinese investment.
Chinese search engine giant Sogou this year chose the UAE for its first artificial intelligence news anchor through a deal with Abu Dhabi Media. Another state conglomerate, ENOC Group, secured a five-year $690 million term loan from a Chinese consortium of banks in June. The deal included Industrial and Commercial Bank of China, Agricultural Bank of China, and China Construction Bank—China’s top three banks in terms of size, assets and profits.
Of course, there are many other partners of BRI, with China’s direct investment in partner countries exceeding $90 billion, while under the Belt and Road Initiative, it has reached more than 170 agreements with over 120 countries. From 2013 to 2018, the trade volume between China and other BRI countries surpassed $6 trillion.
Big numbers—no wonder the UAE and so many others want to be a part of it.