The UAE as a new economic center for Europe


The UAE has in the course of the last few years established itself as a hub for international trade and diplomacy as well as energy (both hydrocarbon and renewable). While Europe and the US are facing lacklustre growth prospects this year (if not recession), the GCC countries are expected to continue to grow this year and 2024 at the fastest rate since 2014.

Already before the Russian war of aggression against Ukraine, the UAE has been at the center of attention. The UAE’s nonoil trade with the EU therefore amounts to EUR 51 bn. and approximately 250,000 Europeans live in the UAE. More than 4 million European tourists visit the country annually. The prominent role played by the UAE in the domain of energy and trade was further underlined at the recent ADIPEC conference, the world’s largest energy event. The UAE’s leadership has at many times expressed its willingness to step in and support its friends and partners in Europe to meet their energy-needs after Russia curbed its gas deliveries to Europe.

The first visit abroad of the President of the United Arab Emirates led Mohamed bin Zayed to France July 2022, where comprehensive cooperation also in the field of energy (supply of diesel) was announced. Soon after, the President visited Greece and various economic agreements were signed at that occasion too. The UAE is also now heavily investing in the exploration of gas fields, the export of LNG as well as renewable energy, such as hydrogen or solar power where the UAE can make important contributions given its geographic and climatic conditions. The growing interest in the UAE as a key partner with respect to energy and the economy is underlined by the frequency of incoming visits as well. The president of the European Council, Charles Michel, visited the UAE on September 8 2022. According to official media reports in the UAE following the visit, the aim was to strengthen cooperation in various areas, among them also tackling climate change. A key contribution will be made by the UAE by hosting the next UN Climate Change Conference COP 28 in November and December 2023 in Dubai. The UAE has at various occasions already emphasized its climate ambitions in the run-up to COP 28 with the goal of climate neutrality by 2050 and emphasis on its own efforts in the field of renewable energy sources, especially solar energy and hydrogen, as well as its own UAE climate diplomacy.


On September 24 and 25 2022, following his trip to Saudi-Arabia, the German Chancellor Olaf Scholz paid a short visit to the UAE accompanied by a business delegation, during which he met with President Mohammed bin Zayed and Climate Change Minister Mariam Almheiri. During the visit, State Secretary Franziska Brantner and Minister of Industry Sultan Al Jaber signed an Energy Security and Industry Accelerator Agreement (ESIA). This intergovernmental agreement, prominently reported in the UAE press, in the form of a Joint Declaration of Intent includes projects in the field of energy supply, decarbonization and climate protection. Chancellor Scholz emphasized to the press that it is important to rely on as many suppliers as possible for energy supply and that the current dependence on one large supplier, namely Russia, will certainly not be repeated.

As a concrete manifestation of the agreement, a contract was signed between RWE and the state-owned company ADNOC for the delivery of LNG to Germany as soon as possible, namely 137,000 cubic meters of LNG are to be delivered to the Brunsbüttel import terminal for the German market. Further LNG deliveries are scheduled to begin this year (in the form of a memorandum of understanding).

In addition, investments are planned by the state-owned renewable energy company Masdar in wind farms in the North Sea and Baltic Sea, which could generate up to 10 GW of renewable energy by 2030. Reference was also made to the cooperation with respect to hydrogen and the ammonia pilot projects with the German companies Steag GmbH and Aurubis AG concerning the supply of hydrogen in the form of ammonia. The Austrian Chancellor Karl Nehammer followed soon after with finance minister Magnus Brunner und energy minister Leonore Gewessler as well as OMV and OEBAG on October 27 2022 when they met President Mohamed bin Zayed to strengthen the strong bilateral bonds and the energy cooperation between both countries. In the course of the visit, two MoUs were therefore signed between OMV and ADNOC on the supply of one LNG cargo (1 TWh) for the coming winter 2023/24 and a “Joint Declaration of Intent” on cooperation at government level on energy and industrial issues as well as on climate protection based on the Strategic Partnership between Austria and the UAE signed in July 2021. Both sides will appoint “Focal Points” to identify projects for cooperation, such as in thefieldsofgas/LNG,derivatives(diesel, etc.), Sustainable Air Fuels (SAF), in hydrogen and renewable energy sources.

In the meantime, the UAE has also been busy signing Comprehensive Economic Partnership Agreements (CEPAs) with other parts of the world too, such as Israel, India or Indonesia, some of the world’s largest and fastest-growing economies. Investments in the UAE therefore also open up new potential markets in other parts of the world and there is a strong interest in signing such agreements also with the European Union or European countries. Just recently negotiations on a CEPA have been started with Ukraine.

This all underlines the UAE’s desire to be at the forefront of action against climate change and invest in renewable energy in the UAE as well as in third countries. Further increasing trade ties also ranks high on the priorities of the UAE’s government as well as investing in new technologies, such as AI. This opens a variety of potential projects for cooperation for European governments and companies alike.