An increasing number of Chinese companies are expected to invest in the UAE’s property and manufacturing sectors next year as the government encourages companies to look overseas for growth, officials said yesterday.
Chinese companies are investing more abroad, allowing the country to achieve a balance between inward and outward direct investment for the first time last year as the country transforms into a capital exporter rather than just a goods exporter.
“We are in a transit phase and we are encouraging companies to go abroad, and that means companies are going out, so it’s a good opportunity for Dubai and other countries,” Zhang Yi, an economic and commercial counsellor at the Chinese consulate in Dubai, said at a business forum.
While traditionally investors in China were interested in trade with the UAE, and Dubai in particular, they are increasingly eyeing other sectors. China is Dubai’s largest trade partner and the UAE’s second-biggest trading partner, behind India. Trade with the country is set to reach US$60 billion by the end of the year, according to the UAE Government.
“Recently we found more and more Chinese people who want to invest in real estate and manufacturing [in the UAE],” said Justin Li, the managing director of the Yingke and Shayan law firm in Dubai.
“There is some change because the Chinese government is encouraging Chinese companies to go abroad and invest overseas. In China, we have a lot of foreign currency we need to invest.”
China is the third-largest foreign direct investor in the world, investing more than $100bn a year. Chinese investments overseas are rising even as total global foreign direct investment declined between 2011 and last year, according to an EY report.
“A lot of Chinese companies want to move their manufacturing [base] outside because labour costs are very high in China right now and the environmental requirements are very high,” said Mr Li.
The UAE’s relations with China received a boost this week following the visit of Sheikh Mohammed bin Zayed, Crown Prince of Abu Dhabi and Deputy Supreme Commander of the Armed Forces. The visit resulted in the signing of a number of agreements.
The Abu Dhabi investment firm Mubadala said on Monday that it would launch a joint fund worth US$10bn with China Development Bank Capital and China’s State Administration of Foreign Exchange.
China’s One Belt, One Road strategy is boosting investments in infrastructure projects along the medieval Silk Road trade route.
China also renewed its currency swap agreement with the UAE in its latest move to internationalise the yuan.
The agreement allows the UAE Central Bank to provide up to 35bn yuan to settle bilateral trades.
dalsaadi@thenational.ae
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Milestones on the road to union
1970
October 26: Bahrain withdraws from a proposal to create a federation of nine with the seven Trucial States and Qatar.
December: Ahmed Al Suwaidi visits New York to discuss potential UN membership.
1971
March 1: Alex Douglas Hume, Conservative foreign secretary confirms that Britain will leave the Gulf and “strongly supports” the creation of a Union of Arab Emirates.
July 12: Historic meeting at which Sheikh Zayed and Sheikh Rashid make a binding agreement to create what will become the UAE.
July 18: It is announced that the UAE will be formed from six emirates, with a proposed constitution signed. RAK is not yet part of the agreement.
August 6: The fifth anniversary of Sheikh Zayed becoming Ruler of Abu Dhabi, with official celebrations deferred until later in the year.
August 15: Bahrain becomes independent.
September 3: Qatar becomes independent.
November 23-25: Meeting with Sheikh Zayed and Sheikh Rashid and senior British officials to fix December 2 as date of creation of the UAE.
November 29: At 5.30pm Iranian forces seize the Greater and Lesser Tunbs by force.
November 30: Despite a power sharing agreement, Tehran takes full control of Abu Musa.
November 31: UK officials visit all six participating Emirates to formally end the Trucial States treaties
December 2: 11am, Dubai. New Supreme Council formally elects Sheikh Zayed as President. Treaty of Friendship signed with the UK. 11.30am. Flag raising ceremony at Union House and Al Manhal Palace in Abu Dhabi witnessed by Sheikh Khalifa, then Crown Prince of Abu Dhabi.
December 6: Arab League formally admits the UAE. The first British Ambassador presents his credentials to Sheikh Zayed.
December 9: UAE joins the United Nations.
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Classification of skills
A worker is categorised as skilled by the MOHRE based on nine levels given in the International Standard Classification of Occupations (ISCO) issued by the International Labour Organisation.
A skilled worker would be someone at a professional level (levels 1 – 5) which includes managers, professionals, technicians and associate professionals, clerical support workers, and service and sales workers.
The worker must also have an attested educational certificate higher than secondary or an equivalent certification, and earn a monthly salary of at least Dh4,000.
What is the FNC?
The Federal National Council is one of five federal authorities established by the UAE constitution. It held its first session on December 2, 1972, a year to the day after Federation.
It has 40 members, eight of whom are women. The members represent the UAE population through each of the emirates. Abu Dhabi and Dubai have eight members each, Sharjah and Ras al Khaimah six, and Ajman, Fujairah and Umm Al Quwain have four.
They bring Emirati issues to the council for debate and put those concerns to ministers summoned for questioning.
The FNC’s main functions include passing, amending or rejecting federal draft laws, discussing international treaties and agreements, and offering recommendations on general subjects raised during sessions.
Federal draft laws must first pass through the FNC for recommendations when members can amend the laws to suit the needs of citizens. The draft laws are then forwarded to the Cabinet for consideration and approval.
Since 2006, half of the members have been elected by UAE citizens to serve four-year terms and the other half are appointed by the Ruler’s Courts of the seven emirates.
In the 2015 elections, 78 of the 252 candidates were women. Women also represented 48 per cent of all voters and 67 per cent of the voters were under the age of 40.
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