UAE and Japan to boost green energy and investment ties

The relationship between the UAE and Japan has deepened in recent years and the two countries plan to focus on boosting green energy and investment ties, Japan’s Prime Minister Fumio Kishida has said. “Japan will promote the Japan-UAE innovation partnership initiative and the green global energy hub initiative for the Middle East including [for the UAE] to be a global clean energy and decarbonisation hub,” Mr Kishida told the UAE-Japan Business Forum in Abu Dhabi on Monday. He called for the two countries to “embark on a joint global green journey that will extend across the Indo-Pacific and to the rest of the world”. The global green energy hub drive will “combine the respective strengths of our two countries – the geographical advantages, low-cost renewable energy resources and strong investment capacities of the UAE and the Middle East on one hand and the cutting-edge decarbonisation technologies of Japan on the other”, Mr Kishida wrote in an article published by state news agency Wam on Sunday. “In the future, we intend to further expand co-operation in the fields of clean energy, green materials, semi-conductors, space, batteries and other advanced technologies as well as start-ups, medical and health care, education and cultural exchange,” Mr Kishida said at the forum. The two countries signed 23 agreements and initial pacts during the forum aimed at bolstering economic, trade and investment ties between the two countries in the fields of energy, industry, advanced technology, artificial intelligence, space, health, transport, environmental conservation and circular economy. Mr Kishida’s trip is his first to the Emirates as Prime Minister and is part of a GCC tour that began with a visit to Jeddah on Sunday. It comes as the UAE and Japan have been boosting ties across various sectors. “Our bilateral relationships have made great strides including in start-ups and space. The UAE is home to 350 Japanese companies and more than 4,000 Japanese residents,” Mr Kishida said. “With the introduction of a visa waiver for UAE passport holders last year and the new Etihad Airways service to Kansai International Airport this year, it is expected we will see an increase in traffic between the two countries.” The UAE's national airlines currently operate about 90 flights per month. The total number of Japanese visitors to the UAE reached about 56,000 during 2022, up from 26,000 from 2021. The Japanese government will also actively support the promotion of investment between the two countries, he said at the business forum. Bilateral relations between the two countries have experienced accelerated growth over the past few years, Abdulla bin Touq, UAE Economy Minister, told the forum. Total trade between the two countries amounted to $51.7 billion in 2022, while non-oil trade exchange reached $14.7 billion, of which non-oil imports to the UAE were $12 billion. “The average non-oil trade between the two countries during the past decade amounted to $14 billion annually, with the exception of the year 2020 that witnessed the spread of the pandemic,” he said. The UAE is Japan’s seventh-largest trading partner, while Japan is the UAE’s eighth-largest, he added. “The latest figures show that the UAE is Japan’s top trading partner in terms of exports and imports in the Arab world, absorbing 40 per cent of Japan’s exports to the region and providing 39 per cent of Japan’s imports from the region,” Mr bin Touq said. The UAE is also the source for 42 per cent of foreign direct investment inflows to Japan from the Mena region. The stock value of Japanese investments in the UAE market is estimated at $14 billion with 10,000 Japanese companies or agencies operating in various sectors including technology, renewable energy, transport and health care, he said. “We look forward to co-operating with our Japanese partners in areas such as infrastructure development, renewable energy, high-tech industries, artificial intelligence, health care, tourism, finance, asset management and advanced manufacturing,” Mr bin Touq said. The UAE's international strategic ties and comprehensive economic partnerships agreements provide Japanese companies with unparalleled access to a multitude of markets, further enhancing their global reach and growth prospects, he said. The Emirates is working towards signing 26 Cepas as it seeks to attract more investment and diversify its economy. The country has already signed Cepas with India, Cambodia, Georgia, Israel, Indonesia and Turkey . It is close to finalising a similar agreements with Kenya and has started talks with Costa Rica. Through the agreements, the Emirates aims to eliminate unnecessary trade barriers, increase market access and set up investment and trade ventures with its partners. “We will also work to enhance joint work with our Japanese partners in the sectors of sustainability, energy, renewable energy and climate change, in conjunction with the UAE’s hosting of the Conference of the Parties to the United Nations Framework Convention on Climate Change [Cop28],” Mr bin Touq said. In January, the UAE and Japan signed preliminary agreements and deals to support energy transition and boost bilateral co-operation. The deals were signed as Dr Sultan Al Jaber, Minister of Industry and Advanced Technology, UAE special envoy to Japan and Cop28 President-designate, met Yasutoshi Nishimura, Japan’s Minister of Economy, Trade and Industry, on the sidelines of Abu Dhabi Sustainability Week. They explored the hydrogen sector as a key component of the energy transition and also discussed the importance of accelerating progress towards carbon neutrality and opportunities for collaboration ahead of Cop28 in the UAE this year. Adnoc also signed a joint study agreement with Tsubame BHB to explore research and development co-operation to find new solutions for manufacturing ammonia. A preliminary agreement was also signed by Masdar and Japanese company Jera covering green hydrogen and renewable energy. Meanwhile, the Federation of UAE Chambers of Commerce and Industry signed a preliminary agreement to set up the UAE-Japan Business Council to build and advance the relations between the two countries' private sectors, Wam reported on Monday.

UAE and Japan to boost green energy and investment ties

Two countries aim to expand co-operation in the fields of green materials, semi-conductors and batteries, Japan's Prime Minister says