On July 18th and 19th, the President of the UAE, His Highness Sheikh Mohamed bin Zayed Al Nahyan, made an official visit to France and met with French President Emmanuel Macron and a number of senior French officials. The goal of the visit was to discuss bilateral strategic relationships that serve their mutual interests, especially in key areas such as trade, investment, energy, technology, renewable energy, food security, and climate change. The visit reaffirmed the important economic relationship between the two nations via the signing of several economic and development agreements and memoranda of understanding. In the main, these agreements represent a response to current global crises, most notably energy security supplies, climate change, and food security, along with the strengthening of the economic partnership between the UAE and France in particular, and the UAE and the EU in general.
Economic relations between the UAE and France have grown steadily in recent years, and the UAE is France’s second strategic partner among the Arab Gulf states. This partnership was clearly established during the annual UAE-France Strategic Dialogue in 2020, when the two countries approved a roadmap for the decade 2020 to 2030, which presents a set of key sectors for cooperation between the two countries, particularly in the areas of economy, trade, investment, nuclear energy, and renewable energy. The most significant features of the economic relations between the two countries include the following:
1. Extensive trade relations between the two nations: The UAE was one of France’s largest trade partners in 2021. The trade volume between the two countries totaled USD 6.5 billion, compared to USD 4.5 billion in 2020. Oil and gas represent the bulk of the UAE’s exports to France, with a value of USD 3.3 billion, while French heavy industries make up the largest proportions of France’s exports, with a value of USD 5.1 billion annually. Here, it should be noted that trade relations between the two nations exceeded USD 100 billion over the last twenty years.
2. Diversified investment cooperation: Over the past years, France has doubled its investments in the UAE. According to many estimates, direct French investments in the UAE totaled nearly EUR 2.5 billion at the end of 2020. The UAE hosts the largest French community in the Gulf region, estimated at 25,000 French citizens, and, according to many reports, the UAE also hosts most of the French companies in the Middle East—600 companies that employ 30,000 people. In return, the UAE has been eager to develop its investment portfolio in France. According to estimates, the UAE is ranked 35th on the list of foreign investors in France.
In this framework, it should be noted that mutual investments between the two countries focus on various sectors of importance to both parties. French investments in the UAE include the communications, technology, energy, gas, education, manufacturing, mining, retail, vehicle repair, and transportation sectors, while the UAE’s investments in France include a variety of sectors, particularly manufacturing of civilian and military aircraft, real estate, tourism, commercial fishing, and manufacturing of tiles and ceramics.
3. Association with a set of joint agreements: In recent years, the UAE and France have signed several agreements and memoranda of understanding, most recently 13 agreements signed during French President Emmanuel Macron’s visit to the UAE in December of 2021, amounting to EUR 15 billion. Similarly, the two countries agreed to organize the UAE-France Energy Days on November 7th and 8th of 2022. Nuclear energy is an important area of cooperation between the two countries. For example, in September of 2018, the French Alternative Energies and Atomic Energy Commission and the UAE’s Federal Authority for Nuclear Regulation signed an agreement to cooperate in the field of nuclear energy.
4. Technological cooperation to promote digital technologies: Digital technologies have been an important linchpin of Emirati-French cooperation, especially with several French companies working on digital transformation processes in the UAE and making use of the initiatives of the French Tech Hub in Dubai UAE, particularly in the field of clean technologies. This trend of cooperation will likely increase in light of the UAE’s interest in employing modern technologies in the economic sphere and transforming itself into a leading global model in this field.
Prior inputs were present amid His Highness Sheikh Mohamed bin Zayed Al Nahyan’s visit to France on July 18th and 19th, during which paths of joint economic cooperation between the two countries were discussed, especially in the areas of investment, technology, renewable energy, food security, environment and climate change, and other vital fields. The two sides also discussed many international issues, most notably global energy security, climate change, and food security. This visit gave rise to several strategic partnerships and agreements in many sectors, including:
1. Signing of strategic agreements for the energy sector and climate change: In the context of strengthening economic relations between France and the UAE, the two sides discussed forthcoming cooperation in the energy sector and signed two agreements. The first is a comprehensive strategic partnership agreement between the UAE and France in the energy sector that focuses on key dimensions, most importantly enhancement of energy security and its provision at an acceptable cost, emissions reduction, and advancement of climate action in preparation for the 28th session of the Conference of the Parties (COP28) to be held in the UAE in 2023. This agreement also includes cooperation in the fields of technology, sustainable aviation fuel production, green financing for energy projects, ongoing joint cooperation between the two countries to limit carbon emissions in the energy sector, and promotion of the role of nuclear energy via the exchange of technical expertise and the provision of nuclear technology and fuel.
The second agreement involves a strategic partnership between ADNOC and TotalEnergies to explore opportunities to promote long-term cooperation between the two companies in areas such as increasing gas production; capturing, using, and storing carbon; and trading and supplying products; thus, creating more opportunities that realize sustainable value for both companies.
2. Enhanced cooperation to achieve food security: His Highness Sheikh Mohamed bin Zayed Al Nahyan affirmed the role of the UAE, in cooperation with France, in supporting global efforts vis-à-vis food security and the attempt to secure a global supply system by supporting the initiative to enhance resilience in the areas of food and agriculture, especially with regard to the adoption of an open, transparent, and flexible food trade system, as well as in providing relevant data to support the agricultural market information system, including attempts to alleviate global pressures on international food security supply chains.
3. Support for close ties between the investment and manufacturing sectors: The visit discussed mechanisms to strengthen the investment partnership launched in December of 2021 between the two countries, in addition to interest in developing cooperation in the investment and manufacturing sectors and in maritime research and development. Thus, the two countries agreed to promote cooperation to develop a maritime research program. It should be noted that the UAE and France are proposing a diverse group of fields in which to invest. For example, the two presidents agreed on the importance of the health sector in terms of investment. In that context, a memorandum of understanding was signed for cooperation between the Pasteur Institute and the Abu Dhabi Public Health Center.
In the same vein, the two sides discussed investing in future projects in the education sector, such as the Rubika vocational school. They also signed a joint declaration of cooperation between the UAE and France in the field of higher education and the expansion of French-language teaching in Emirati schools. They also discussed the possibility of exploring new opportunities for cultural cooperation following the success of the two countries’ partnership in the Abu Dhabi Louvre.
4. Launch of the UAE-France Business Council: His Highness Sheikh Mohamed bin Zayed Al Nahyan’s visit to France included the further institutionalization of economic relations between the two countries. To that end, the UAE-France Business Council was launched to strengthen economic relations between the two countries in the fields of energy, transportation, and investment. The council’s objectives are to promote economic exchanges and allow private-sector fields in both the UAE and France to communicate with public-sector decision-makers, as well as to define and implement joint investment projects via specialized working groups that formulate an effective action plan. Each group will submit recommendations in its area of expertise to strengthen economic exchange between the two countries.
5. Increasing cooperation in the science and technology sectors: Given the UAE’s interest in modern technologies, it has reached several agreements aimed at promoting cooperation between the two countries. The visit included the signing of a memorandum of understanding between the Mohammed Bin Rashid Space Centre and the National Centre for Space Studies in France to cooperate on moon exploration, in addition to two letters of intent regarding Earth observation and human spaceflight activities.
Finally, His Highness Sheikh Mohamed bin Zayed Al Nahyan’s visit to France emphasizes the important strategic nature of relations between the two countries, of which economic dimensions are an important factor. Over the past years, the two nations have been able to develop bilateral trade terms. This cooperative path has become more important at the current moment for reasons related to the development vision adopted by the UAE’s political leaders, not to mention the economic issues arising from the Ukrainian war, which continues to put significant pressures on European countries, including France.
In this context, French President Macron has begun to face many domestic challenges amid declining purchasing power and inflation rates, as well as the fear that Russia will halt gas supplies to France. Thus, economic relations with the UAE may be a mechanism Macron can use to alleviate the severity of the domestic economic crisis, as well as to provide an alternative source of energy within the framework of the French and EU plan to diversify energy sources in order to free them from Russian pressure.