Chinese companies are increasingly seeking partnerships in the United Arab Emirates, as the Gulf state acts as a “super-connector,” linking East and West, amid a shift in trade beyond traditional sectors, according to a senior banker.
Mohammed Al Marzouqi, CEO of HSBC Bank UAE, said the business has expanded to include innovative industries such as hydrogen, ammonia, carbon capture, electric vehicles, solar energy and consumer technology due to China’s significant investment in research and development, driving progress in these areas. In an exclusive interview during Abu Dhabi Finance Week last week.
He said: “Historically, the relationship with China was very limited, but what we are witnessing today is a change from this trend,” adding that Chinese companies are participating in many important infrastructure projects in the Emirates.
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Abu Dhabi Global Market, the international financial center in the UAE capital, signed an agreement to enhance cooperation with the Beijing Financial Street Service Office during the UAE-China Investment Summit held within the framework of Abu Dhabi Financial Week. The office is responsible for promoting and developing the Beijing Financial Street District as a national center for financial management.
Abu Dhabi Global Market signed a memorandum of understanding with the Beijing Financial Street Service Office during the UAE-China Investment Summit held as part of Abu Dhabi Finance Week. Image: Handout alt=The Abu Dhabi Global Market signed a memorandum of understanding with the Beijing Financial Street Service Office during the UAE-China Investment Summit held as part of Abu Dhabi Financial Week. Photo: Bulletin>
In the field of renewable energy alone, Chinese companies are involved in nearly 50 percent of the projects currently underway in the UAE, according to Al Marzouqi. Chinese solar PV manufacturers are stepping up efforts in the UAE and the Middle East to meet local demand and act as gateways to US, European and other markets.
The UAE has invested US$50 billion in renewable energy projects in 70 countries over the past decade, with another US$50 billion allocated to investments at home and abroad over the next decade. It also aims to become the largest global producer of hydrogen by 2031.
Al Marzouqi said: “Everyone considers the UAE an amazing bridge between the East and the West, and a super link,” noting that the UAE is China’s second largest trading partner in the Middle East after the Kingdom of Saudi Arabia.
The volume of bilateral trade between China and the UAE reached 95 billion US dollars in 2023, according to official data. In the first half of 2024, trade volume exceeded 50 billion US dollars. The visit of Chinese Premier Li Qiang to the UAE next September could pave the way for investment and cooperation in the fields of energy, health, education and other fields.
“Culturally, there are a lot of similarities between the two countries, and they go beyond the UAE to the broader Middle East,” he said. “So when it comes to the business environment, the element of trust is [deeply] Rooted. We can see transactions being executed in a very smooth manner.”
The preliminary agreement signed last week between the Abu Dhabi Global Market and the Beijing Financial Street Service Office aims to build on the relations that were established between the two sides in September 2018.
“The cooperation leverages the unique strengths of both parties,” said Lu Wusheng, general manager of the Financial Street Service Bureau in Beijing. “We aim to promote industrial exchanges and encourage cross-border business establishment.”
Abu Dhabi, which owns 90 percent of the UAE’s oil reserves and most of its sovereign wealth, is seeking to diversify its economy, with the Abu Dhabi Global Market at the heart of the economic transformation as a financial center and free zone.
“With regard to foreign direct investment [FDI]“It is not just Chinese companies attracting foreign direct investment from Abu Dhabi to China,” said HSBC’s Al Marzouqi. “We are seeing tangible investment flows in both directions.”
He added that this is due to the strong relationship at the governmental level between the two sides. “We saw very strong messages from both countries, and they were consistent in those messages.”
HSBC recently arranged two visits from the Abu Dhabi Investment Office, which is responsible for supporting investment in the emirate, to Shanghai and Hong Kong to promote business development, investment and trade flows between Abu Dhabi and Asia.
“[We are] Al Marzouqi said: “This will facilitate much larger visits, and those visits will take place next year. There will be multiple visits during 2025.”
The banker said that HSBC will continue to invest in the UAE, which it considers a priority market. The lender also plans to leverage its Chinese team in the UAE. With 20 Mandarin-speaking staff, it is one of the largest among local and international banks.
“Therefore, in both places, we pay close attention to the strength of our existing employees and leverage our network to explore opportunities for our clients,” Al Marzouqi said.
He also said that the bank would like to see more Chinese companies implementing public-private partnerships in the UAE and the wider region.
“I believe this will be very beneficial for Chinese companies, as it brings financial and operational benefits due to long-term financing, combined with shared investment risks, innovation and knowledge transfer.”
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