Opportunities for Chinese Businesses in the UAE: Trade, Tech, and Energy

From logistics and energy to digital trade, the UAE is a gateway for Chinese businesses into Middle East, Africa and beyond. Learn how Emirate’s tax reliefs, free zones, policies and investment benefits, cultural ties, and opportunities for expansion have created a fertile ground for Chinese investors and firms.

China and the United Arab Emirates (UAE) have built one of the fastest-growing trade relationships in the Middle East.

As per China’s Ministry of Foreign Affairs, bilateral trade volumes between China and the UAE achieved $101.8 billion in 2024, which is an extraordinary 800-fold increase since their diplomatic relations began in 1984. The UAE, thus emerged, as China’s largest trading partner in the Middle East and China as the UAE’s top global trading partner. The non-oil trade has also expanded at double-digit rates, and both sides expect trade volumes to reach US$200 billion by 2030.

Bilateral trade momentum

Trade between China and the UAE has expanded in both scale and scope. Chinese exports reached US$65.6 billion in 2024, with machinery, electronics, textiles, and consumer goods making up the bulk. The UAE exported US$36.2 billion to China, led by petrochemicals, aluminum, and re-exports. In the first quarter of 2025, non-oil trade grew 18 percent year on year. Within that, UAE exports to China rose by 432.5 percent, while imports from China increased 12.7 percent.

The UAE accounts for nearly 30 percent of China’s non-oil trade with Arab countries. It is also China’s second-largest trading partner in West Asia and North Africa. Hydrocarbons remain part of the exchange, but the flow of manufactured goods and high-value services is widening the base. Trade projections tell that bilateral commerce could reach $200 billion by 2030.

In a recent PwC study, it was confirmed that the UAE is the leading choice for Chinese firms looking to establish regional headquarters in the Middle East. Nearly 100 percent respondents ranked the UAE ahead of Saudi Arabia (77 percent) and Qatar (26 percentage) in terms of environment best suited for doing business.

Foreign direct investment (FDI) and sectoral reach

Chinese investment in the UAE has demonstrated a great diversity and scale. By the end of 2023, Chinese investments in the UAE totaled $5.8 billion, and the UAE investments in China reached $4.5 billion, which is a 96 percent increase from the previous year. More than 15,000 Chinese companies are now active in the Emirates, across finance, construction, manufacturing, and technology.

The Dubai International Financial Centre (DIFC) illustrates this footprint. It is home to the UAE’s only cluster of Chinese financial institutions, which includes China’s five largest banks. Together, these five banks contribute more than 30 percent of DIFC’s total banking and capital markets assets. Dubai is thus playing the role of a base for financing Chinese-linked projects across the Middle East and Africa.

Real estate and construction are also central to this partnership. Chinese contractors have won projects like the recent US$408 million Oceano development in Ras Al Khaimah and the US$272 million Bluewaters Bay project in Dubai. At the industrial level, the China–UAE Industrial Capacity Cooperation Demonstration Zone has drawn more than 60 firms with combined investment above US$2.2 billion.

Market access reforms and ownership

The UAE has liberalized foreign ownership rules to attract investors. Federal Decree-Law No. 26 of 2020 allows foreign shareholders to own 100 percent of companies in most sectors. Previously, foreign investors were restricted to 49 percent ownership without a local partner.

The FDI reform applies to more than 1,100 commercial and industrial activities in Abu Dhabi and extensive sectors in Dubai. The UAE has opened up agriculture, manufacturing, transport, healthcare, education, information and communications, hospitality, and construction to foreign money. Only a small group of “strategic” activities, like the defense and telecoms, still require separate approvals.

For Chinese firms, the ability to establish wholly owned subsidiaries in areas once restricted has given a broader entry route into the UAE economy. The Foreign Direct Investment Law of 2018, combined with these ownership reforms, has helped the UAE attract US$45.6 billion in FDI in 2024, a 48.5 percent increase from the previous year. The result placed the UAE among the world’s top 10 destinations for foreign investments.

The UAE as a re-export and logistics hub

The UAE’s logistics ecosystem makes it a natural base for Chinese firms to distribute products across the Middle East, Africa, and beyond. More than 60 percent of Chinese exports shipped to the UAE are re-exported to over 400 cities.

Jebel Ali Free Zone (Jafza) is central to this strategy. It hosts more than 450 Chinese companies employing over 1,500 staff, including 11 Fortune 500 firms. Trade between Jafza and China has more than doubled in value and volume since 2020. The zone offers integrated warehousing, customs services, and access to Jebel Ali Port, which handled over 960,000 vehicles in 2024. China is the largest automotive trade partner at this port.

The logistics network is expanding further through the Etihad Rail project, supported by China Railway Construction Corporation Limited (CRCC). Once fully operational, the rail line will link some major industrial zones and ports across the Gulf and cut transport costs by improving distribution efficiency.

Infrastructure and manufacturing partnerships

Chinese companies are integral to the UAE’s infrastructure development. Shanghai Electric Group built the world’s tallest solar power tower, a 263‑meter facility at the Mohammed bin Rashid Al Maktoum Solar Park. The project generates more than 3.6 billion kilowatt‑hours annually and supplies electricity for 320,000 households.

Manufacturing partnerships also extends in clean energy and industrial production. China Machinery Engineering Corporation developed the 2.1 GW Al Dhafra PV2 solar plant, and PowerChina completed the country’s first wind power demonstration project, generating electricity for 23,000 households annually.

The Industrial Capacity Cooperation Demonstration Zone is another important project in the making. Spanning 12.2 square kilometers in Khalifa Industrial Zone Abu Dhabi, it hosts manufacturers from electronics to building materials. The zone provides a platform for export‑oriented industries, and regulatory and tax benefits that appeal to Chinese investors.

Technology and autonomous mobility innovations

The UAE’s ambition to lead in autonomous transport has created opportunities for Chinese technology firms. Three major Chinese robotaxi operators, Baidu, WeRide, and Pony.ai, are rolling out services with local partners. WeRide launched trials in Abu Dhabi in June 2025, and Baidu plans to deploy dozens of Apollo Go robotaxis by 2026. Pony.ai has agreements with Dubai’s Roads and Transport Authority for seventh‑generation robotaxi trials starting in 2025 and its driverless services are scheduled for 2026.

Chinese firms are also supporting digital infrastructure and talent development in the UAE. Huawei has launched ICT Academy programs with 11 UAE universities for building local capacity in cloud computing, artificial intelligence (AI), and cybersecurity.

Financial services and cross‑border finance

The UAE’s role as a financial hub has drawn several Chinese institutions. China International Capital Corporation (CICC) received its DIFC license in 2025 to join other Chinese banks in offering trade finance, wealth management, and cross‑border transaction services. Chinese issuers have listed more than US$22 billion in debt instruments, including green bonds, on Nasdaq Dubai.

The UAE‑China Joint Investment and Economic Cooperation Working Group, formed under a May 2024 memorandum of understanding, supports bilateral investment collaboration and creates new cooperation opportunities in digital economy, green development, and SME financing.

Consumer goods and retail market access

The UAE imports a variety of Chinese consumer products, from electronics to everyday goods. The retail infrastructure is well developed between the two countries. Major retailers like Carrefour, Lulu Hypermarket, and Spinneys serve as distribution channels for Chinese brands in the Middle East. The UAE’s free zones are especially lucrative as they offer 100 percent foreign ownership and tax exemptions for wholesale and retail operations. The UAE’s diverse consumer base, combined with its re‑export role, gives Chinese firms access to high‑income local buyers and regional markets of the Gulf Cooperation Council (GCC).

Tourism and cultural exchange

Tourism is one of the most visible connections between China and the UAE. In 2024, Dubai alone hosted 824,000 Chinese visitors, a 31 percent rise from the previous year. Abu Dhabi received 290,000 visitors in the first four months alone, more than double the figure from the same period in 2023. Together, the Emirates welcome more than one million Chinese tourists each year, supported by a network of over 200 direct flights per month.

Infrastructure and cultural choices have adapted to this flow. Alipay and WeChat Pay are widely accepted in stores across the UAE, Chinese-language services are common, and cultural programs like Spring Festival events are now part of an Emirates’ calendar.

Belt and Road Initiative integration

The UAE has become an important part of China’s Belt and Road Initiative (BRI). It has committed US$10 billion to the UAE-China Joint Investment Cooperation Fund, which finances BRI projects in East Africa. Within the Emirates, 13 MoUs with China cover areas ranging from logistics to manufacturing under BRI.

The Industrial Capacity Cooperation Demonstration Zone stands as a flagship BRI project. It offers Chinese companies a production and distribution base for exports across the Middle East and Africa. Non-oil trade with BRI countries now accounts for 90 percent of the UAE’s total non-oil trade, which means these agreements are heavy weights in the country’s external commerce.

Outlook for Chinese businesses in the UAE

For Chinese firms, opportunities in the UAE are diverse and interconnected. Infrastructure and manufacturing ventures feed directly into the Emirates’ diversification plans into non-oil economy. Technology projects in autonomous vehicles and ICT gel well with national innovation priorities of the UAE government. Tourism and cultural exchange are providing a strong social foundation for these economic ties.

The outlook is not without ifs and buts. Stability in regulation, timely delivery of infrastructure, and careful navigation of geopolitical pressures will all matter. If these factors hold, the UAE will continue to serve as a central hub for Chinese companies seeking growth across the Gulf, Africa, and beyond.

Also read: A Guide to Product Liability in the UAE: Laws, Responsibilities, and Compliance Strategies

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