Dubai aims to attract more Chinese investment and EV firms

Non-oil bilateral trade jumped 4% annually to $67.8bn last year

Dubai Chambers will host a business forum in Beijing later this month, said Mohammad Ali Rashed Lootah, its president and chief executive. Victor Besa / The National

Dubai aims to attract more Chinese investment to the emirate amid government initiatives and the strengthening of ties between the UAE and the world’s second-largest economy, a senior official said.

The commercial and tourism hub of the Middle East is targeting Chinese investments in sectors including green tech, electric vehicle (EV) companies, e-commerce, artificial intelligence, health care and renewable energy, Mohammad Ali Rashed Lootah, president and chief executive of Dubai Chambers, told The National in an interview.

“With historical relations spanning decades, China and Dubai have witnessed fruitful economic and trade co-operation with record trade volume and an expanding two-way investment,” said Mr Lootah. China “is a market of great strategic importance for the emirate” and “Dubai chambers will continue to play an instrumental role in attracting leading companies” to Dubai, he added.

The UAE, the Arab world’s second-largest economy, is bolstering its ties with China.

The UAE is China's largest trading partner in the Arab world, with trade and investment spanning many sectors, including crude oil, petrochemicals and artificial intelligence.

Chinese investments in the UAE increased by more than 16 per cent annually last year to $1.3 billion, Zhang Yiming, China’s ambassador to the UAE, said at an Abu Dhabi event in May.

China is also the largest trading partner of Dubai with non-oil bilateral trade worth Dh249 billion ($67.8 billion) last year, up 4 per cent compared to 2022 and more than 83 per cent growth compared to a decade ago, according to Dubai Chambers latest data.

Though the total Chinese investments in Dubai are not known, Mr Lootah said there were 5,100 Chinese companies in the emirate by the end of the first quarter, with 362 companies setting up their operations alone in sectors such as trading and services, real estate, transport and storage and communication.

“If you take it as a percentage, it is almost more than 5 per cent (on an annual basis), around 7 per cent growth, just in one quarter, which is very healthy,” Mr Lootah, said.

Chinese companies are keen to invest in Dubai as the emirate’s economy continues to grow and roll out new initiatives to attract foreign direct investment.

Last year, Dubai unveiled the Dubai Economic Agenda (D33) to double the size of its economy to Dh32 trillion over the next decade and establish the emirate among the top three global cities.

The plan aims to support 30 private companies in their push to become unicorns – start-ups worth more than $1 billion.

It also aims to attract an average of Dh60 billion in foreign direct investment annually in the next decade to reach a total of Dh650 billion by 2033.

“Dubai’s D33 Agenda creates exciting opportunities for Chinese businesses and investors and (we) are eager to work together to achieve the emirate’s economic ambitions and unlock mutual benefits,” Mr Lootah, said.

“There are abundant opportunities for Chinese companies in trade and investment as some of the key targets outlined in the D33 agenda include increasing the contribution of FDI to Dubai’s economy and boost foreign trade to $7 trillion.”

Dubai Chambers currently operates 31 representative offices around the world, with the three in China in Shanghai, Shenzhen and Hong Kong, as it focuses on attracting more investment.

There is also an increased interest from Chinese renewable and EV companies to set up operations in Dubai and the emirate is trying “to help them and facilitate and answer all their inquiries and even support them in case they're planning to expand their international presence and have their regional HQ [headquarter] here in Dubai”, Mr Lootah said.

Dubai remained the world's top destination for greenfield foreign direct investment projects in 2023, the third consecutive year it has achieved that status.

The emirate secured 1,070 global greenfield FDI projects last year, 142 per cent more than second-placed Singapore (442) and 148 per cent higher than third-placed London (431), Dubai Media Office said in May, citing data from the Financial Times fDi Markets report.

The Dubai economy grew by 3.2 per cent annually in the first quarter of this year. It is also looking to strengthen collaboration with Chinese technology companies specialised in artificial intelligence, blockchain and Internet of Things, “as we share China’s passion for innovation and the digital economy”, Mr Lootah said.

China is boosting its tech capabilities as it tries to compete especially with the US for dominance and influence.

Companies including Alibaba, ByteDance, TikTok’s parent, Huawei and Tencent have been dominating in technology.

Mr Lootah said Dubai Chambers will host a business forum in Beijing later this month, where more than 50 Dubai-based companies and 350 Chinese companies will participate.

“The forum will explore investment opportunities in high-potential sectors such as green tech, e-commerce, AI, healthcare and renewable energy,” he said.