UAE, China ready for closer business ties with visas on arrival

By Daniel Sellers

First established in 1984, diplomatic ties between the United Arab Emirates and the People’s Republic of China have developed smoothly on the basis of high-level trade. Contrary to the misconception that the relationship pivots on Abu Dhabi’s role as a petrochemical supplier, the growth of non-oil trade, in fact, as well as reciprocal diplomacy has played a key role in the development bilateral relations. In 2014, China became the UAE’s largest non-oil trading partner for the first time, highlighting the importance of the UAE as a strategic economic partner in the Persian Gulf region, as well as a trading hub for Chinese products to the Middle East and African markets. The UAE is a founding member of the Asian Infrastructure Investment Bank and an active participant in the Belt and Road initiative, further emphasizing its role as a hub for Chinese companies investing in Belt and Road markets in the region. 

View of illuminated Burj Al Arab skyscraper in Dubai, United Arab Emirates at dusk on December 2, 2013.[Photo: dfic.cn]

Incremental annual trade growth between the UAE and China has continued to the present day, boosted in great part by the practical steps being implemented by both Governments to support the freer flow of people, goods and capital. As a result, bilateral non-oil trade reached 60bn USD in 2016. The best example of these practical steps was the introduction of visas on arrival for Chinese visitors to the UAE, implemented in October 2016. In 2016 there were 540,000 Chinese visitors to the UAE. In 2017 the final count is expected to be closer to 750,000, or almost a 50% year-on-year increase. The impact of the Belt and Road initiative is commonly measured in project or loan values, however I would also argue the increased exchange of peoples and ideas is another commendable achievement of the initiative. People are the drivers of exchange which leads to economic activity, with culture, mutual respect, and reciprocity as the foundations of people to people exchange. Dubai is already home to 200,000+ Chinese residents and over 4000 Chinese companies. I expect a relative increase in these figures as Chinese tourism and visitor numbers continue to increase as a result of the new visa on arrival system, a sure sign that that practical diplomacy is having a lasting impact on cultural exchange and business relations between the UAE and China.   

Practical steps also yield practical results. In September 2017 the Mayor of Shanghai, H.E. Ying Yong, visited the WorldSkills competition in Abu Dhabi where China was selected to host the competition in Shanghai in 2021 - an event it hopes to use for building a stronger national network of skilled workers and to enhance international vocational exchanges. Later that very same month, Dubai Chamber hosted a business matchmaking event for 30-strong high-level business delegation from Shandong province led by the Provincial Vice Governor, H. E. Mr. Wang Shujian. In my daily work as the Head of China Office for Dubai Chamber of Commerce & Industry, I can already notice the tangible impact of the new visa on arrival system for Chinese visitors. For everyone from high level Government travelling to Abu Dhabi to small trading companies traveling to Dubai for exhibitions, this simple step has made the planning and travelling process much more manageable. 

In my experience, the removal of red tape and market barriers is the best tool to boost trade and investment. From January 18th 2018, UAE citizens will be granted visas on arrivals in China. This reciprocal development will have a great impact for bilateral ties. In 2018, Dubai Chamber’s representative office in Shanghai plans to organize numerous bilateral delegations to support the development of business ties in high potential sectors such as food, renewable energy, logistics and high-tech. For organizing delegation visits, the visa on arrival system simply makes our life easier.

The outlook for even greater trade and investment ties, boosted by the new visa systems’ potential impact on bilateral flow of people, between the two countries is promising. This is especially evident when we place the two national economic strategies side by side. The UAE Vision 2021 outlines the Government’s roadmap to further diversify the domestic economy, both in terms of sources of GDP growth and trading relationships. In terms of strategic sectors for the UAE, high tech, renewable energy, and value-added manufacturing have all been targeted for investment with various incentives and Government initiatives.  At the same time, China’s Five Year Plan 2016-2020 cements the PRC’s commitment to moving China up the value chain from a growth model based on fixed-asset investment and low-end manufacturing and exports to a new engine based on innovation, domestic consumption and services. In other words, what is already a strong trading relationship, is well placed to evolve further with the benefit of higher value-added exchanges in sectors such as renewable energy and high-tech. China is actively developing these sectors and the UAE is open for business. The increased flows of people, especially business people, scientists, and researchers, between the UAE and China will make high level exchanges in these target sectors more possible. 

As any trading relationship moves up the value chain, the bilateral exchanges of ideas and values become increasingly important. The freer movement of people between China and the UAE is likely to support synergies in target sectors highlighted by both leaderships. I for one am looking forward to the fruits of this on display at both the UAE and Chinese pavilions at World Expo 2020 Dubai. 

(Daniel Sellers is Head of China International Office at Dubai Chamber of Commerce & Industry)