The UAE's heavy and early investments in renewable energy sources, advanced technology, and its reliable trade reputation, are positioning it to become a future regional heavyweight and reduce its import dependency.
The Gulf state, which brings in goods and services equivalent to more than 90 per cent of its gross domestic product as of 2023, according to the World Bank, has found the fruits of its early-bird investments ripening.
This is compounded by recent geopolitical events that have pushed the UAE centre stage. The global economic landscape reshaping under the pressures of the US-China trade war and mounting geopolitical tension means nations are leading to reassembly of supply chains and co-operative partners.
The UAE stands as a grounded and capable ally in business and trade, this is demonstrated by its US deal for a $1.4 trillion investment framework over 10 years announced in March 2025 and President Donald Trump's visit to the region. The UAE's manufacturing readiness has it poised for major possibility as a destination of future production and assembly as the world's needs change.
Strategic neutrality
The UAE’s foreign policy – marked by diplomatic pragmatism and strong ties with both East and West – offers a critical edge. The UAE maintains open and friendly trade relationships with major global economies, including the US, China, India and the European Union.
The UAE is also practising “minilateralism”, an emerging concept the Washington Institute describes as how small groups of nations collaborate to tackle problems or pursue mutual goals. One example is its partnership with India to establish an information and communications technology centre in Ethiopia.
As India seeks new markets for its $26 billion tech exports it uses the UAE as port of entry, with which it benefits from 99 per cent tariff reductions with its UAE Cepa agreement. The UAE enhances its role as a trade hub for re-exporting to Ethiopia and the wider African continent, and their joint ICT centre in Ethiopia aims to train five million coders by 2027, boosting regional digital development.
The UAE has signed 21 Comprehensive Economic Partnership Agreements. Deals struck with India, Israel, Turkey, Indonesia, Cambodia, Georgia, Costa Rica and Mauritius have already taken effect.
This geopolitical neutrality enables it to become a trusted manufacturing and distribution base for multinationals seeking to hedge against supply-chain risk without taking sides.
Tech advantage
At the heart of the country’s industrial transformation is Operation 300bn, an ambitious strategy spearheaded by the Ministry of Industry and Advanced Technology. The goal, to double the manufacturing sector’s GDP contribution from Dh133 billion to Dh300 billion ($36.2 billion-$81.6 billion) by 2031.
Key pillars of the strategy include prioritising high-value sectors such as aerospace, pharmaceuticals, food security and renewable energy. Harnessing cutting-edge technology such as AI, robotics and additive manufacturing, and building domestic capacity through initiatives like the National In-Country Value Programme and Make it in the Emirates campaign.
The Emirates Development Bank is anchoring this strategy with Dh30 billion in targeted funding, supporting more than 13,000 SMEs and creating 25,000 industrial jobs.
While traditional manufacturing centres rely on cheap labour, the UAE is betting on automation and Industry 4.0 to bridge the cost gap. Smart factories, robotic assembly lines and AI-driven supply chains are rapidly taking root in Dubai and Abu Dhabi’s industrial zones.
These innovations neutralise the demographic disadvantage of a small local population and mitigate labour cost pressures.
Low cost, abundant energy
Access to inexpensive and stable energy, including rapidly scaling clean energy sources, gives the UAE a strong cost advantage, especially for energy-intensive sectors such as aluminium, petrochemicals, and green hydrogen. With global investors increasingly prioritising sustainability, the UAE’s pivot to eco-conscious industrialisation is both timely and strategic.
The country’s alignment with global climate goals, including net-zero targets and the promotion of circular economy principles, positions it favourably among ESG-conscious multinational firms.
The UAE’s heavy investment in renewables and nuclear energy reduces the carbon intensity of its manufacturing sector. For example, Emirates Global Aluminium is powered partly by solar and nuclear, has a carbon footprint 50 per cent lower than the global average, making it attractive for markets with strict emissions standards.
For instance, the EU’s Carbon Border Adjustment Mechanism, effective from 2026, levies tariffs on carbon-heavy imports such as steel, aluminium, cement and chemicals. UAE-manufactured products, made using clean energy, have lower carbon emissions and thus incur reduced tariffs, estimated at €70 ($78) per tonne of CO2 equivalent (tCO2e) as of May 17 and projected to go up to 149/tCO2e by 2030 according to BloombergNEF, boosting their competitiveness against higher-carbon alternatives.
Navigating the challenges
While the road map is promising, challenges remain such as regulatory complexity, access to finance, talent shortages and fierce regional competition.
Currency constraints further complicate the UAE’s competitiveness. The UAE dirham’s peg to the US dollar limits monetary policy flexibility, preventing the country from adjusting its currency to maintain price competitiveness when the US dollar strengthens or when US interest rates rise above those of competitors.
Additionally, rising operational costs, particularly for imported materials, and global protectionist trends could create headwinds. However, co-ordinated action between government, industry and finance is steadily dismantling these barriers. Schemes such as the Industrialists Programme aim to cultivate a skilled Emirati workforce, while public-private dialogue is improving bankability and risk sharing.
Conflicts in neighbouring areas, such as the Israel-Gaza conflict and instability in Yemen, disrupt regional supply chains and deter foreign investment in manufacturing. US concerns over technology leakage to China could limit access to critical technology such as 5G and AI chips, vital for smart factories. These tensions also raise shipping and insurance costs for UAE exports through the Strait of Hormuz, a critical trade route.
The UAE’s 3.5 million workforce lacks sufficient AI and robotics experts, with only 2,000 graduates annually from MBZUAI and similar programmes, necessitating 30 per cent expatriate hiring for smart factories.
While the Emirates Development Bank’s Dh30 billion supports 13,000 SMEs, 60 per cent of smaller manufacturers report loan rejection rates due to high automation project risks, limiting Industry 4.0 adoption.
A strategic moment
Despite these challenges, co-ordinated action between government, industry and finance is steadily dismantling barriers. The UAE’s manufacturing push is not merely about factories and GDP figures, it’s about repositioning the nation in the global value chain.
As major economies unravel old supply lines and seek stable, tech-savvy alternatives, the UAE has what others lack: political neutrality, visionary strategy, world-class infrastructure and the will to act.
The era of globalisation as we knew it may be fading. But in the space it leaves behind, new regional powers will rise. The UAE, bold and prepared, is on track to become one of them.
Dubai Bling season three
Cast: Loujain Adada, Zeina Khoury, Farhana Bodi, Ebraheem Al Samadi, Mona Kattan, and couples Safa & Fahad Siddiqui and DJ Bliss & Danya Mohammed
Rating: 1/5
Tips to avoid getting scammed
1) Beware of cheques presented late on Thursday
2) Visit an RTA centre to change registration only after receiving payment
3) Be aware of people asking to test drive the car alone
4) Try not to close the sale at night
5) Don't be rushed into a sale
6) Call 901 if you see any suspicious behaviour
Dust and sand storms compared
Sand storm
- Particle size: Larger, heavier sand grains
- Visibility: Often dramatic with thick "walls" of sand
- Duration: Short-lived, typically localised
- Travel distance: Limited
- Source: Open desert areas with strong winds
Dust storm
- Particle size: Much finer, lightweight particles
- Visibility: Hazy skies but less intense
- Duration: Can linger for days
- Travel distance: Long-range, up to thousands of kilometres
- Source: Can be carried from distant regions
Six large-scale objects on show
- Concrete wall and windows from the now demolished Robin Hood Gardens housing estate in Poplar
- The 17th Century Agra Colonnade, from the bathhouse of the fort of Agra in India
- A stagecloth for The Ballet Russes that is 10m high – the largest Picasso in the world
- Frank Lloyd Wright’s 1930s Kaufmann Office
- A full-scale Frankfurt Kitchen designed by Margarete Schütte-Lihotzky, which transformed kitchen design in the 20th century
- Torrijos Palace dome
Visit Abu Dhabi culinary team's top Emirati restaurants in Abu Dhabi
Yadoo’s House Restaurant & Cafe
For the karak and Yoodo's house platter with includes eggs, balaleet, khamir and chebab bread.
Golden Dallah
For the cappuccino, luqaimat and aseeda.
Al Mrzab Restaurant
For the shrimp murabian and Kuwaiti options including Kuwaiti machboos with kebab and spicy sauce.
Al Derwaza
For the fish hubul, regag bread, biryani and special seafood soup.
Match info:
Burnley 0
Manchester United 2
Lukaku (22', 44')
Red card: Marcus Rashford (Man United)
Man of the match: Romelu Lukaku (Manchester United)
More from Rashmee Roshan Lall
Kibsons%20Cares
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THE BIO
Favourite car: Koenigsegg Agera RS or Renault Trezor concept car.
Favourite book: I Am Pilgrim by Terry Hayes or Red Notice by Bill Browder.
Biggest inspiration: My husband Nik. He really got me through a lot with his positivity.
Favourite holiday destination: Being at home in Australia, as I travel all over the world for work. It’s great to just hang out with my husband and family.
MOUNTAINHEAD REVIEW
Starring: Ramy Youssef, Steve Carell, Jason Schwartzman
Director: Jesse Armstrong
Rating: 3.5/5
Anxiety and work stress major factors
Anxiety, work stress and social isolation are all factors in the recogised rise in mental health problems.
A study UAE Ministry of Health researchers published in the summer also cited struggles with weight and illnesses as major contributors.
Its authors analysed a dozen separate UAE studies between 2007 and 2017. Prevalence was often higher in university students, women and in people on low incomes.
One showed 28 per cent of female students at a Dubai university reported symptoms linked to depression. Another in Al Ain found 22.2 per cent of students had depressive symptoms - five times the global average.
It said the country has made strides to address mental health problems but said: “Our review highlights the overall prevalence of depressive symptoms and depression, which may long have been overlooked."
Prof Samir Al Adawi, of the department of behavioural medicine at Sultan Qaboos University in Oman, who was not involved in the study but is a recognised expert in the Gulf, said how mental health is discussed varies significantly between cultures and nationalities.
“The problem we have in the Gulf is the cross-cultural differences and how people articulate emotional distress," said Prof Al Adawi.
“Someone will say that I have physical complaints rather than emotional complaints. This is the major problem with any discussion around depression."
Daniel Bardsley
UPI facts
More than 2.2 million Indian tourists arrived in UAE in 2023
More than 3.5 million Indians reside in UAE
Indian tourists can make purchases in UAE using rupee accounts in India through QR-code-based UPI real-time payment systems
Indian residents in UAE can use their non-resident NRO and NRE accounts held in Indian banks linked to a UAE mobile number for UPI transactions
COMPANY PROFILE
Name: Qyubic
Started: October 2023
Founder: Namrata Raina
Based: Dubai
Sector: E-commerce
Current number of staff: 10
Investment stage: Pre-seed
Initial investment: Undisclosed
APPLE IPAD MINI (A17 PRO)
Display: 21cm Liquid Retina Display, 2266 x 1488, 326ppi, 500 nits
Chip: Apple A17 Pro, 6-core CPU, 5-core GPU, 16-core Neural Engine
Storage: 128/256/512GB
Main camera: 12MP wide, f/1.8, digital zoom up to 5x, Smart HDR 4
Front camera: 12MP ultra-wide, f/2.4, Smart HDR 4, full-HD @ 25/30/60fps
Biometrics: Touch ID, Face ID
Colours: Blue, purple, space grey, starlight
In the box: iPad mini, USB-C cable, 20W USB-C power adapter
Price: From Dh2,099
COMPANY PROFILE
Initial investment: Undisclosed
Investment stage: Series A
Investors: Core42
Current number of staff: 47
Abu Dhabi World Pro 2019 remaining schedule:
Wednesday April 24: Abu Dhabi World Professional Jiu-Jitsu Championship, 11am-6pm
Thursday April 25: Abu Dhabi World Professional Jiu-Jitsu Championship, 11am-5pm
Friday April 26: Finals, 3-6pm
Saturday April 27: Awards ceremony, 4pm and 8pm
THE BIO
Favourite place to go to in the UAE: The desert sand dunes, just after some rain
Who inspires you: Anybody with new and smart ideas, challenging questions, an open mind and a positive attitude
Where would you like to retire: Most probably in my home country, Hungary, but with frequent returns to the UAE
Favorite book: A book by Transilvanian author, Albert Wass, entitled ‘Sword and Reap’ (Kard es Kasza) - not really known internationally
Favourite subjects in school: Mathematics and science
The five pillars of Islam
1. Fasting
2. Prayer
3. Hajj
4. Shahada
5. Zakat
UAE currency: the story behind the money in your pockets
Defence review at a glance
• Increase defence spending to 2.5% of GDP by 2027 but given “turbulent times it may be necessary to go faster”
• Prioritise a shift towards working with AI and autonomous systems
• Invest in the resilience of military space systems.
• Number of active reserves should be increased by 20%
• More F-35 fighter jets required in the next decade
• New “hybrid Navy” with AUKUS submarines and autonomous vessels
The Birkin bag is made by Hermès.
It is named after actress and singer Jane Birkin
Noone from Hermès will go on record to say how much a new Birkin costs, how long one would have to wait to get one, and how many bags are actually made each year.
More about Middle East geopolitics
Who has been sanctioned?
Daniella Weiss and Nachala
Described as 'the grandmother of the settler movement', she has encouraged the expansion of settlements for decades. The 79 year old leads radical settler movement Nachala, whose aim is for Israel to annex Gaza and the occupied West Bank, where it helps settlers built outposts.
Harel Libi & Libi Construction and Infrastructure
Libi has been involved in threatening and perpetuating acts of aggression and violence against Palestinians. His firm has provided logistical and financial support for the establishment of illegal outposts.
Zohar Sabah
Runs a settler outpost named Zohar’s Farm and has previously faced charges of violence against Palestinians. He was indicted by Israel’s State Attorney’s Office in September for allegedly participating in a violent attack against Palestinians and activists in the West Bank village of Muarrajat.
Coco’s Farm and Neria’s Farm
These are illegal outposts in the West Bank, which are at the vanguard of the settler movement. According to the UK, they are associated with people who have been involved in enabling, inciting, promoting or providing support for activities that amount to “serious abuse”.
Analysis
Maros Sefcovic is juggling multiple international trade agreement files, but his message was clear when he spoke to The National on Wednesday.
The EU-UAE bilateral trade deal will be finalised soon, he said. It is in everyone’s interests to do so. Both sides want to move quickly and are in alignment. He said the UAE is a very important partner for the EU. It’s full speed ahead - and with some lofty ambitions - on the road to a free trade agreement.
We also talked about US-EU tariffs. He answered that both sides need to talk more and more often, but he is prepared to defend Europe's position and said diplomacy should be a guiding principle through the current moment.
Details
Through Her Lens: The stories behind the photography of Eva Sereny
Forewords by Jacqueline Bisset and Charlotte Rampling, ACC Art Books
Why it pays to compare
A comparison of sending Dh20,000 from the UAE using two different routes at the same time - the first direct from a UAE bank to a bank in Germany, and the second from the same UAE bank via an online platform to Germany - found key differences in cost and speed. The transfers were both initiated on January 30.
Route 1: bank transfer
The UAE bank charged Dh152.25 for the Dh20,000 transfer. On top of that, their exchange rate margin added a difference of around Dh415, compared with the mid-market rate.
Total cost: Dh567.25 - around 2.9 per cent of the total amount
Total received: €4,670.30
Route 2: online platform
The UAE bank’s charge for sending Dh20,000 to a UK dirham-denominated account was Dh2.10. The exchange rate margin cost was Dh60, plus a Dh12 fee.
Total cost: Dh74.10, around 0.4 per cent of the transaction
Total received: €4,756
The UAE bank transfer was far quicker – around two to three working days, while the online platform took around four to five days, but was considerably cheaper. In the online platform transfer, the funds were also exposed to currency risk during the period it took for them to arrive.
The specs
Engine: 2.0-litre 4-cylinder turbo
Power: 240hp at 5,500rpm
Torque: 390Nm at 3,000rpm
Transmission: eight-speed auto
Price: from Dh122,745
On sale: now
When Umm Kulthum performed in Abu Dhabi
Known as The Lady of Arabic Song, Umm Kulthum performed in Abu Dhabi on November 28, 1971, as part of celebrations for the fifth anniversary of the accession of Sheikh Zayed bin Sultan Al Nahyan as Ruler of Abu Dhabi. A concert hall was constructed for the event on land that is now Al Nahyan Stadium, behind Al Wahda Mall. The audience were treated to many of Kulthum's most well-known songs as part of the sold-out show, including Aghadan Alqak and Enta Omri.
Company%C2%A0profile
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UAE currency: the story behind the money in your pockets
The specs
Engine: 2.0-litre 4-cyl, 48V hybrid
Transmission: eight-speed automatic
Power: 325bhp
Torque: 450Nm
Price: Dh289,000
Honeymoonish
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How much do leading UAE’s UK curriculum schools charge for Year 6?
- Nord Anglia International School (Dubai) – Dh85,032
- Kings School Al Barsha (Dubai) – Dh71,905
- Brighton College Abu Dhabi - Dh68,560
- Jumeirah English Speaking School (Dubai) – Dh59,728
- Gems Wellington International School – Dubai Branch – Dh58,488
- The British School Al Khubairat (Abu Dhabi) - Dh54,170
- Dubai English Speaking School – Dh51,269
*Annual tuition fees covering the 2024/2025 academic year
