Igniting Trade and Tech Partnerships – President Sheikh Mohamed’s Visit to China and South Korea

 President of the UAE, His Highness Sheikh Mohamed bin Zayed Al Nahyan, commenced his state visit to Asia’s fourth-largest economy, South Korea, today. This significant tour, which also includes a subsequent visit to China, aims to bolster trade, technological exchanges, and strengthen defense and energy collaborations.

South Korea: A Strategic Partnership

During his two-day visit to Seoul, President Sheikh Mohamed bin Zayed Al Nahyan will focus on diversifying the UAE’s economy, traditionally reliant on oil, into new sectors. The UAE is currently the second-largest economy in the Middle East and seeks to expand its global economic footprint through strategic partnerships.

A senior researcher at Japan’s JIME Center, Institute of Energy Economics, noted, "The primary reason for President Mohamed’s visit to the two countries is to access recent technological advancements and facilitate technology transfers to the UAE from both China and South Korea."

President Sheikh Mohamed expressed his enthusiasm on social media, stating, "Today I arrived in Seoul, where I will join President of South Korea Yoon Suk Yeol in discussing ways to advance the Special Strategic Partnership between the UAE and the Republic of South Korea, through economic partnership and close people-to-people ties."

Economic and Technological Collaboration

The UAE and South Korea share a robust economic relationship. One of the most notable collaborations is the $20 billion Barakah Nuclear Power Plant in the UAE, which began construction in 2009 and became fully operational in April 2021. This plant significantly contributes to the UAE’s electricity supply. Talks are currently underway for a second nuclear power plant, with South Korea likely to secure the contract.

The UAE is the second-largest Arab trade partner of South Korea and ranks 14th globally. Trade between the two nations constitutes 20 percent of South Korea’s trade with the Arab world. UAE investments in South Korea have risen to $578 million, while South Korea has invested approximately $2.2 billion in the UAE.

Broader Economic Engagements

In addition to South Korea, the UAE is engaged in discussions with several other countries, including Serbia, Vietnam, the Philippines, New Zealand, and Ecuador, to forge new economic partnerships. The focus of these talks is on fostering foreign direct investment (FDI) in each other’s markets, thereby enabling the private sector to form cross-border partnerships and drive growth.

China: Expanding Trade Horizons

Following his visit to South Korea, President Sheikh Mohamed will travel to Beijing on Thursday. The UAE is the largest trading partner of China in the Middle East, with significant trade in crude oil, petrochemicals, and artificial intelligence. Chinese investments in the UAE have surged by 16 percent, reaching $1.3 billion, according to Zhang Yiming, the Chinese Ambassador to the UAE.

UAE investments in China have also seen a remarkable increase of 120 percent over the past year, constituting nearly 90 percent of the total investments from the Middle East and the Arab world in China. The non-oil trade between the two countries reached AED 264.2 billion ($72 billion) in 2022, marking an 18 percent increase from 2021.

Future Trade Agreements

Mr. Kondo, the Japanese researcher, highlighted the possibility of the UAE pursuing a free trade agreement (FTA) with China. Given that the China-GCC FTA negotiations have stalled, a UAE-China FTA could significantly enhance bilateral trade and economic cooperation.