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In mid-February a 140-strong delegation of business leaders and government officials from Abu Dhabi visited China, taking in Beijing, Shanghai, Shenzhen and Hong Kong over six days.
The delegation, led by the Abu Dhabi Department of Economic Development (ADDED), was a who’s who of the Emirate’s government, business and industry executives.
The trip brought the China-UAE relationship, Beijing’s most robust in the Middle East, into sharper focus. By the numbers, Saudi Arabia is the more significant; Riyadh is consistently China’s biggest trading partner in the Arab world, with bilateral trade hitting over $107 billion in 2023. The UAE, a much smaller market, was right behind at $104 billion.
Interestingly, where Saudi Arabia runs a surplus with Beijing by dint of oil exports, trade with the Emirates balances towards Beijing, a result of the UAE’s re-export model.
Nearly two thirds of China’s exports to Europe, Africa and the rest of the Middle East pass first through Dubai, making it a major centre for Chinese commerce.
Geopolitics tends to dominate narratives about the Middle East but for China the region is mostly about energy and business, and the UAE’s advantage in finance, logistics and commerce has resulted in a substantial but unassuming Chinese presence.
Last year there was a 17.5 percent increase in Chinese companies operating in the DMCC
In 2000 an estimated 7,000 Chinese were living in the UAE; there are now around 400,000, by far the largest Chinese expatriate community in the Middle East. Dubai hosts the only international Chinese state-sanctioned school.
At a recent China-Arab Entrepreneurs Summit in Abu Dhabi, the UAE Minister of Economy Abdulla Bin Touq al Marri said that nearly 15,500 Chinese companies have operated in the UAE and that Chinese investment into the country has passed $6 billion.
These numbers don’t happen in a vacuum, and in this case, it seems like a classic ‘trade follows the flag’ model. In 2012 Chinese Vice Premier Wen Jiabao visited the UAE and announced a strategic partnership, China’s first such relationship in the Gulf.
The partnership deepened ties and government-to-government cooperation. The economic benefits, however, were substantial. In the six years prior to Wen’s visit, Chinese companies signed over $5 billion worth of contracts in the UAE. In the six years following, that number jumped to nearly $15 billion.
This set the stage for a state visit by Xi Jinping, the communist party leader and head of state, in the summer of 2018, when the relationship was elevated to a comprehensive strategic partnership, the highest position in China’s hierarchy of diplomatic ties.
The upgrade coincided with a huge spike in contracts for Chinese companies – nearly $18 billion’s worth since July 2018. Over the same period trade has more than doubled, from $53 billion to the current $107 billion. In short, the UAE has proven itself to be a lucrative partner for China.
Visits by delegations like the one led by ADDED last month show the trajectory we can expect. In addition to business forums and government-to-government meetings in each city, delegates also met representatives from TikTok owner ByteDance, electronics group Xiaomi, electric vehicle giant BYD, investment company Legend Holding and other Chinese commercial leaders, all of which are expanding their footprint in the Emirates.
Abu Dhabi is not the only emirate active in China these days. A delegation from Dubai, led by Dubai Multi Commodities Centre (DMCC) visited Beijing and Shenzhen in late February, looking to develop collaboration with Chinese companies.
Last year there was a 17.5 percent increase in Chinese companies operating in the DMCC, with over 950 currently active. Meanwhile, the ruler of Ras Al Khaimah, Sheikh Saud bin Saqr Al Qasimi, made two visits to China last autumn, giving a keynote address at an international trade fair in Xiamen in September and then visiting Guangdong in November to sign a cooperation agreement focused on innovation, smart cities and the digital economy.
If you want to understand China’s economic presence in the Middle East, the UAE is a good place to start.
Jonathan Fulton is an associate professor of political science at Zayed University in Abu Dhabi and a nonresident senior fellow for Atlantic Council’s Middle East Programs and the Scowcroft Middle East Security Initiative.
