The Middle East and Latin America might seem like an odd pair for bilateral commercial deals - at literal opposite ends of the globe from each other, in fact. But there are many links between the Arabian Gulf and Latin America that, combined with strides in economic development in both regions, make a case for a much stronger trade partnership.
Despite cultural and historic ties, economic ties between Latin America and the Middle East remain limited. But there are considerable potential opportunities for improved trade between the two regions, such as tourism, manufacturing and agriculture, according to a recent report from the Dubai Chamber of Commerce and Industry.
For the Gulf states, Latin America represents one of the most dynamic and resource-rich regions in the world. While GCC governments and companies are well placed to support Latin America’s need for investment in infrastructure and can also offer services in logistics, tourism and aviation.
Dubai's non-oil trade with Latin America reached about $4.63bn in 2015, up about a quarter over five years. Brazil accounted for about 67 per cent of total Latin American trade with Dubai, as an exporter of crops such as sugar cane.
At present, commodities dominate bilateral trade – food from Latin America heading to the Middle East accounted for 9 per cent of the GCC’s total agricultural imports in 2016, totaling $4.3 billion. Crude and refined oil from OPEC Middle East members bound for Latin America were around 160,000 barrels of oil per day in 2016.
There is already a cultural link between the Arab and Hispanic worlds.
Historically, Arabs lived alongside the Spanish and Portuguese and ruled much of the Iberian Peninsula for hundreds of years. The legacy of that period lives on. From architecture, to genetics to the Spanish language - which counts more than 4,000 words with Arabic origins. A similar legacy can be found in Portuguese culture as well.
Spain’s colonisation of the Americas and later the Philippines spread Hispanic culture, starting with Christopher Columbus discovering “The New World” (the Americas of the present-day). The Portuguese, with Brazil and territories in Africa such as Angola and Mozambique, have a similar colonial influence, too. In a way, since the Hispanic and Lusophone world were heavily influenced by the Arabs, indirectly their global influence was also an Arab one as well, to an extent.
Modern Arab influence in Latin American can be seen from massive emigration from the Middle East, particularly from the Levant region. Latin America is home to more Arabs anywhere outside the Arab world, ranging from 16 to 30 million descendants. Brazil alone has the largest population of Lebanese descendants in the world with almost 7 million Brazilians of Lebanese descent. Chile has the largest Palestinian population outside the Arab World with almost 500,000 descendants. And - fun fact - the largest mosque in the Americas is in Buenos Aires, Argentina, home to around three to four million Arab descendants, mainly from Syria.
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These days, reliance – rather than influence – determines much of Latin America’s current path.
The region’s dependence on the US is illustrative of that, and the current climate is not only economic but also political. The North American Free Trade Agreement (NAFTA) illustrates that Mexico, with its member partners the US and Canada, whose $303bn of exports sales to the US in 2017 accounts for about 81 per cent of its exports. Canada is Mexico’s second biggest export market with about $10.4bn of sales. China is third at $5.4bn. There is no Arab country in Mexico’s top 15 export destinations.
With the current renegotiated NAFTA - spearheaded by President Trump and recast to the United States-Mexico-Canada Agreement - Mexico is looking for more trading partners to diversify trade flows away from the US, underscored by its recent comprehensive free trade agreement with the European Union.
Mexico is not the only Latin American economy actively seeking to diversify its commercial ties away from dependence on the US. In Brazil, for example, China recently overtook the US as its main trading partner.
The GCC, also undergoing economic development transformations, can successfully integrate its capital, know-how and financing of key investment projects across Latin America – not just in agriculture but across oil and gas and large infrastructure and sustainable initiatives in the region. There is certainly opportunity.
Richie Santosdiaz is a UAE-based economic development expert with a focus on internationalisation and an advisor with London-based Pax Tecum Global Consultancy
Indoor cricket in a nutshell
Indoor Cricket World Cup – Sep 16-20, Insportz, Dubai
16 Indoor cricket matches are 16 overs per side
8 There are eight players per team
9 There have been nine Indoor Cricket World Cups for men. Australia have won every one.
5 Five runs are deducted from the score when a wickets falls
4 Batsmen bat in pairs, facing four overs per partnership
Scoring In indoor cricket, runs are scored by way of both physical and bonus runs. Physical runs are scored by both batsmen completing a run from one crease to the other. Bonus runs are scored when the ball hits a net in different zones, but only when at least one physical run is score.
Zones
A Front net, behind the striker and wicketkeeper: 0 runs
B Side nets, between the striker and halfway down the pitch: 1 run
C Side nets between halfway and the bowlers end: 2 runs
D Back net: 4 runs on the bounce, 6 runs on the full
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Director: Basel Adra, Yuval Abraham, Rachel Szor, Hamdan Ballal
Stars: Basel Adra, Yuval Abraham
Rating: 3.5/5
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Label: Warner Records
Number of tracks: 11
Rating: 4/5
Brief scoreline:
Toss: South Africa, elected to bowl first
England (311-8): Stokes 89, Morgan 57, Roy 54, Root 51; Ngidi 3-66
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In numbers: PKK’s money network in Europe
Germany: PKK collectors typically bring in $18 million in cash a year – amount has trebled since 2010
Revolutionary tax: Investigators say about $2 million a year raised from ‘tax collection’ around Marseille
Extortion: Gunman convicted in 2023 of demanding $10,000 from Kurdish businessman in Stockholm
Drug trade: PKK income claimed by Turkish anti-drugs force in 2024 to be as high as $500 million a year
Denmark: PKK one of two terrorist groups along with Iranian separatists ASMLA to raise “two-digit million amounts”
Contributions: Hundreds of euros expected from typical Kurdish families and thousands from business owners
TV channel: Kurdish Roj TV accounts frozen and went bankrupt after Denmark fined it more than $1 million over PKK links in 2013
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Tips for job-seekers
- Do not submit your application through the Easy Apply button on LinkedIn. Employers receive between 600 and 800 replies for each job advert on the platform. If you are the right fit for a job, connect to a relevant person in the company on LinkedIn and send them a direct message.
- Make sure you are an exact fit for the job advertised. If you are an HR manager with five years’ experience in retail and the job requires a similar candidate with five years’ experience in consumer, you should apply. But if you have no experience in HR, do not apply for the job.
David Mackenzie, founder of recruitment agency Mackenzie Jones Middle East
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
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
