Tareq’s view
In an era of rising protectionism, the UAE is moving in the opposite direction. While the US, China, and other countries erect trade barriers, Abu Dhabi is pushing ahead with its alternative: a web of bilateral agreements that will help turn the Emirates into a global trade superpower.
Its latest and biggest move is the start of talks between the UAE and the EU — its second-largest trading partner — announced after a call between UAE President Sheikh Mohamed bin Zayed and European Commission President Ursula von der Leyen on Thursday.
For the Emirates, the trade agreements are part of a long-term diplomatic push aimed at establishing a trade nexus with the Emirates at its core.
Historically, like other Gulf Cooperation Council (GCC) members, the UAE had limited ability to negotiate trade agreements, as the Gulf bloc handled negotiations collectively. However, the GCC operates at a snail’s pace: It began negotiations with the EU for a free trade agreement in 1990. It still hasn’t been signed.
Unsurprisingly, the UAE has recently decided to reclaim sovereignty over its trade relationships.
In the past three years, the UAE has signed trade agreements with Australia, India, Indonesia, Israel, Kenya, Malaysia, New Zealand, and Turkey. Abu Dhabi is also exploring agreements in Latin America, focusing on Argentina, Brazil, and Guyana, and working within the GCC to reach a Gulf free trade agreement with the UK.
Although its economy is relatively small, the UAE has the potential to be a major trading partner for any country.
The Emirates’ strategy is supported by a combination of infrastructure investments, financial innovation, and geographic positioning. Despite a population of just over 11 million, the country has eight international airports and six national carriers, providing direct links between Europe, Asia, Africa, and the Americas. Its ports, logistics hubs, and free zones are among the most advanced globally, while its financial sector incorporates traditional, Islamic, and green finance.
Abu Dhabi is working on building an ecosystem where products manufactured in the Emirates can be exported duty-free to some of the world’s largest markets, with cheap and efficient logistics as well as diverse legal environments to choose from.
The EU has much to gain from a deal. The Emirates can serve as a staging point for European goods and services to reach the wider world. The simplicity of Emirati bureaucracy, the efficiency of its international transportation, and the ease of its immigration system can make the UAE an ideal offshore destination for European business.
Strategically, ties between Abu Dhabi and EU states are already deepening. Germany is buying liquefied natural gas from the UAE, while the Emirates is investing in French AI data centers and renewable energy in Greece, and partnering with Hungary to develop drones.
For the Emirates, an agreement would open doors to a vast consumer base in the EU, building on non-oil trade that reached $68 billion in 2024.
At a time when protectionism and trade skepticism is growing, the UAE is doubling down on its commitment to free trade and economic openness. When the EU-UAE trade deal is finalized, it will be a milestone for the UAE, and it may provide the boost that Europe needs to expand its market.
Tareq Alotaiba has 12 years of experience in economic policy, foreign affairs, and national security with the Abu Dhabi and UAE Federal governments. An Abu Dhabi native, he is currently pursuing a master’s degree in Security Studies at Georgetown University.