Trade Dispute: Gulf States Scent Their Opportunity
While concerns are mounting in the Gulf that the region’s oil-rich economies could get caught in the crossfire of global trade disputes, some see opportunity amid the uncertainty. The tariff conflict initiated by former US President Donald Trump and the resulting volatility on global stock markets are being viewed by many in Dubai and beyond as a potential advantage.
Written by Gérard Al-Fil, Dubai
Stock exchanges in Dubai, Abu Dhabi (both UAE), and Riyadh (Saudi Arabia) have not been immune to the turbulence sparked by the so-called «Trump tariffs.» Like many global indices, the regional benchmark TASI on the Saudi Stock Exchange gave up its gains from the first quarter. Still, as of April 7, the index had limited its loss to around six percent—relatively contained, given broader market declines.
Despite the headwinds, Humaid Bensalem, Secretary General of the UAE’s Association of Chambers of Commerce, believes the Gulf states may actually hold a strategic advantage in the escalating tariff tensions.
«We in the UAE maintain good relations with all countries around the world. Products from across the globe are transported and distributed through the UAE,» Bensalem told finews.com at the Annual Investment Meeting (AIM) in Abu Dhabi.
Though he stopped short of referring directly to it, the UAE’s extensive logistics infrastructure—especially the ports in Dubai and Abu Dhabi—has long enabled international players to bypass trade barriers, effectively serving as a global trade pivot.
No «Game Changer» for Gulf Economies
Karim Awad, Group CEO of Egyptian investment bank EFG Holding, was more direct. Speaking to Arab News on the same day in Dubai, he said the 10 percent tariffs imposed by the US on Gulf Cooperation Council (GCC) countries are «not a game changer.»
Awad emphasized that up to 90 percent of Saudi Arabia’s construction projects are likely to continue unaffected by market volatility. That, in turn, means robust, multi-billion-dollar demand for financing solutions—good news for regional banks.
He also pointed to the strength of Dubai’s booming property market and a vibrant startup scene across the region, describing both as effective hedges against losses in other parts of the world.
FDI Confidence Continues to Grow
Alia Almazrouei, UAE Minister of State for Entrepreneurship, highlighted that the country attracted approximately $30 billion in foreign direct investment (FDI) in 2023, up from $22.7 billion the previous year, according to the World Investment Report.
«This reflects international investors’ confidence in the UAE’s vision and stability,» she noted. «The UAE now ranks eleventh globally in FDI inflows.»
Looking ahead, Almazrouei expects further growth in foreign investment, particularly from China, underscoring the Gulf’s rising role as a global economic player amid shifting geopolitical tides.
