China-UAE cooperation is mutual beneficial

The ninth round of free trade area negotiations between China and the Gulf Cooperation Council took place in Riyadh on Dec 23. 

The United Arab Emirates hopes to upgrade its economic and trade cooperation with China. The bilateral trade volume between China and the UAE this year is expected to hit US$60 billion, up 9.5 percent year-on-year. The UAE has become China’s second largest trade partner and its largest market in the Middle East. China has more than US$8 billion investment in the UAE, mainly in infrastructure and trade. 

In December 2015, the two countries agreed to set up a cooperation investment fund of $US10 billion, and signed 9 cooperative agreements in energy and resources, infrastructure, trade and investment, aerospace and education.

Statistics from the UAE government indicate there are more than 4,200 Chinese enterprises in banking, energy and resources, telecommunication, e-commerce, etc. with investment in the UAE, and more than 200,000 Chinese people working in the country. 

The RMB’s share in payment in the UAE has increased quickly in the past two years with the deepening of mutual financial connection. 

On Dec. 9, the People’s Bank of China authorized the Agricultural Bank of China’s Dubai branch to undertake RMB settlement business in the UAE, the second TMB settlement center in the Middle East. Analysts believe the new center will further promote the RMB’s usage in the Middle East. 

From January to September, China invested US$390 million in the UAE, up 3.52 times year-on-year.  

The UAE has great potential in infrastructure, real estate, aviation and tourism, as its capital Dubai will host the World Expo in 2020, which will provide more opportunities for China-UAE cooperation. The UAE proposes to build smart cities and smart governments, and create global innovation centers, new energy centers and Islamic economic centers. These proposals are compatible with the Chinese government’s innovation and entrepreneurship programs.