Today's Edition
KHALED AL KHAWALDEH (ABU DHABI)
Established in 1972, diplomatic ties between the UAE and the US have evolved significantly, particularly over the past two decades, as both nations have sought to address regional challenges and enhance mutual interests.
Today, the two countries cooperate on a full range of issues including defence, non-proliferation, trade, law enforcement, energy policy, and cultural exchange.
With ties only deepening as the UAE seeks to play a pivotal role in mitigating regional turbulence and promoting stability, as well as pioneering the development of AI and space industries.
With the visit of President His Highness Sheikh Mohamed bin Zayed Al Nahyan to the US on Monday, the relationship is set to open its next chapter.
Investment and Trade
The UAE is one of the United States' largest trading partners in the Middle East, with bilateral trade amounting to $31.4 billion in 2023 according to the UAE embassy in Washington.
The US exports a range of goods, including machinery, electronics, and aircraft, and enjoys a healthy $18.3 billion trade surplus with the UAE.
Exports are increasingly steadily, growing 19% since 2022, a trend that is expected to continue in the coming years.
Meanwhile the UAE exports more than $5 billion in mainly oil and gas products to the U.S, but is rapidly diversifying its export base, to include manufactured goods and services.
Aside from trade the UAE has a healthy and growing investment relationship with the United States, with Emirati investments in the US totalling $22.6 billion in 2022, up 6.8% from 2021 according to the Executive office of the US President.
On the other hand, the US investing $16.2 billion in 2022 in the UAE in several fields including mining, manufacturing, and wholesale trade.
Sovereign Wealth Fund, Abu Dhabi Investment Authority (ADIA) and Mubadala Investment Company have made considerable strides in US markets.
GlobalFoundries which stands as Mubadala's most significant investment and represents the largest private investment in New York State history.
As the world's second-largest semiconductor chip manufacturer, the company plays a crucial role in the global tech landscape. UAE-based Lunate Capital is investing at least $30 billion into US firms for climate projects, exemplifying the increasing financial ties between the two nations.
Abu Dhabi Global Markets and Dubai International Financial City have also seen an influx of US asset managers set up offices and investment firms in recent years.
AI and Technology
US companies have also increasingly invested in the UAE as a regional and global technological hub, particularly in the emerging fields of AI.
As the UAE seeks to become a global leader in the fields of AI, the country has grown its relationship with US which it sees as a vital technological partner in order to achieve its ambitions.
This has seen the signing of several high-profile deals with the US top tech firms.
Among the notable investments is Amazon's commitment of $5 billion to expand its AWS operations in the UAE, a move projected to create approximately 6,000 full-time jobs over the next 13 years.
Similarly, Microsoft has invested $1.5 billion in Abu Dhabi's G42, a partnership aimed at driving innovation in AI and digital transformation, this has since seen plans emerge to establish a number of AI research centres across Abu Dhabi.
Meanwhile, Google's ecosystem supports around 50,000 jobs in the UAE through its Android Developer System, underscoring the growing importance of tech in the region's economy.
Nvidia also maintains a longstanding relationship with the UAE and has recently partnered with G42 to use its Earth-2 platform, which aims to address climate change that is causing unprecedented damage to the global economy with floods, drought and extreme weather like rising temperatures in many places across the globe.
Moreover, in May 2024, the UAE and USA governments signed a Memorandum of Understanding (MoU) to strengthen collaboration and share knowledge in the field of IP rights protection.
Security and Defence
Security cooperation is a cornerstone of US-UAE ties, particularly in countering terrorism and addressing regional instability.
The UAE has been a key ally in US-led coalitions, and is often referred to as the preferred counter-terrorism partner in the Middle East and plays a vital role in maintaining security in the Gulf and wider Middle Eastern region.
At the forefront of this collaboration is the UAE Air Force's operation of the state-of-the-art F-16 Block 60, known as the "Desert Falcon."
These advanced aircraft have been instrumental in countering violent extremism, protecting critical shipping routes, and promoting regional stability.
Notably, in December 2020, the US sale of the F-35 Lightning II aircraft to the UAE cleared Congressional review, enhancing the UAE's capacity for collective security in line with US National Defense Strategy objectives.
A formal defense cooperation agreement signed in 1994 has facilitated joint training, prepositioning of US military assets, and the transfer of sophisticated weaponry.
An updated agreement came into force in May 2019.
The UAE stands out as one of only three nations-and the sole Arab country-to engage with the US in six coalition actions over the past 30 years.
This includes contributions to missions in Afghanistan, Libya, Somalia, and the fight against ISIS.
In Afghanistan, UAE special forces have been key allies, and their F-16s provided vital air support for NATO operations. Similarly, in Libya, the UAE deployed aircraft to assist in enforcing a U.N.-mandated no-fly zone.
The UAE's ongoing commitment to combating extremism and supporting humanitarian initiatives further solidifies its role as a vital US ally.
From fighting Al Qaeda to shutting down key terror finance networks, the UAE has been proactive in addressing security challenges.
With the current crisis in Gaza, the upcoming visit of the UAE President is expected to focus on pushing towards regional stability and deepening the security cooperation between the two countries.
Transport and Logistics
The transportation and logistics relationship between the UAE and the United States is in recent years has been emphasised by substantial aircraft orders from Emirates Airlines and FlyDubai.
In 2023, Emirates Airlines made headlines with a staggering $52 billion order from Boeing during the Dubai Airshow, while FlyDubai followed suit with an $11 billion order for 30 Boeing 787-9 Dreamliners. Furthermore, Boeing's collaboration with Strata Manufacturing, a UAE-based company, highlights the depth of industrial ties between the two countries.
This partnership has evolved to include the production of vital components for the 777 and 787 aircraft, such as the 787 vertical fin shipset, along with sourcing composite materials for the upcoming 777X.
These initiatives reflect a growing synergy in aerospace manufacturing, reinforcing the strategic bond between the UAE and the U.S.
