UAE and South Korea agree on new strategies to boost entrepreneurship and SMEs

The UAE is the East Asian country’s second-largest trade partner in the GCC and the Arab world

Abdullah bin Touq, UAE Minister of Economy, discusses bilateral economic relations with Lee Young, South Korean Minister of SMEs and Startups. Photo: Ministry of Economy

The UAE and South Korea have held talks to promote entrepreneurship and support the growth of small and medium enterprises in the two countries.

Representatives from both countries met as part of the K-Business Day in Middle East 2023, which was held at Dubai World Trade Centre on Monday. It was attended by Emirati and Korean entrepreneurs, start-up owners, investors, business incubators and accelerators.

The two-day event was organised by a group of investment institutions and business incubators in the UAE and South Korea, including Korea Federation of SMEs, Korea Institute of Startup and Entrepreneurship Development, and Korea Technology and Information Promotion.

The UAE is South Korea’s second-largest trade partner in the GCC and the Arab world as of 2022, said Abdullah bin Touq, UAE Minister of Economy.

UAE-South Korean non-oil foreign trade totalled Dh3.4 billion ($917 million) in the first two months of 2023, up 9 per cent from the previous year, he added.

UAE exports to South Korean markets registered nearly 35 per cent growth to reach Dh627 million over January and February this year.

Last year, the volume of non-oil trade exchanges totalled Dh19.5 billion, reflecting a 14 per cent year-on-year increase.

During the meeting, the UAE and South Korea agreed on new co-operation plans in the field of entrepreneurship, including programmes and facilities to foster start-up growth, enhance investments and enable exports to new markets.

During the meeting, Mr bin Touq and Lee Young, South Korea's Minister of SMEs and Start-ups, discussed incentivising and encouraging SMEs and entrepreneurs to invest in the emerging sectors of the economy to enhance their contribution to gross domestic product growth.

“The meeting marks a significant milestone in fostering greater opportunities for SMEs in both countries' markets,” Mr bin Touq said.

“It serves as a platform to facilitate the exchange of experiences and knowledge between the UAE and Korea, particularly in areas such as venture capital financing, modern technologies and innovative digital solutions.”

The UAE’s SME sector plays a pivotal role in driving national economic growth and ensuring its sustainability. In 2020, SMEs contributed about 63 per cent to the country's GDP, exceeding Dh734 billion.

They make up 94 per cent of the total private sector companies operating in the UAE, with 557,000 companies, according to official data.

The UAE had recently announced its intention to invest about Dh110 billion in South Korea over the next few years. Currently, the UAE's investments in South Korea are concentrated in key sectors such as industry, trade, shipping, communications, real estate and commerce.

South Korean foreign direct investment in the UAE reached nearly Dh8.1 billion as of early 2021, marking a remarkable growth of 73 per cent since the beginning of 2013. These investments primarily focused on the financial, insurance, mining, retail, real estate, transport, energy and technology sectors.

The UAE and South Korea are working to strengthen bilateral ties. In December last year, President Sheikh Mohamed met Kim Dae-ki, special envoy of the South Korean President.

During the meeting, both sides stressed the importance of expanding current co-operation and partnership between the UAE and South Korea, especially in the economy, trade, investment, energy in its various traditional and renewable sectors, advanced technology and other fields that relate to economic diversification plans and building a knowledge-based economy.