Diplomacy often unfolds gradually. But every so often, there are moments when the pace of change accelerates, when relationships evolve, trust deepens and opportunities align. The ties between the EU and the UAE are in such a moment.
When I arrived in Abu Dhabi two years ago, I sensed great potential in our partnership. However, what we have witnessed since then has gone far beyond potential – it has been a true transformation. Today, the relationship between the EU and the Emirates is entering a new phase: more strategic, more comprehensive and more aligned.
This new chapter is grounded in shared values and joint priorities. At a time when fears are rising and geopolitical tensions are sharpening, the EU and the UAE are choosing a different path, one of partnership, bridge building and opportunity.
In April, President Sheikh Mohamed and European Commission President Ursula von der Leyen agreed to launch negotiations on an EU-UAE Free Trade Agreement, an agreement between the world´s largest economic bloc and a global trading hub. This historic event sets the stage for expanded economic ties across goods, services, digital trade and strategic sectors such as renewable energy, green hydrogen and critical raw materials.
The numbers already speak volumes. The EU is the UAE’s first investment partner and second-largest global trading partner. Our mutual investments amount to €328 billion ($382.86 billion). A future Free Trade Agreement should unlock untapped mutual benefits. But the potential of our relationship goes well beyond the existing context. For example, the EU and the UAE are currently negotiating a Strategic Partnership Agreement that will expand our co-operation to cover traditional and emerging sectors such as space, AI, cybersecurity, education, climate innovation, sustainability and much more, providing huge opportunities for further economic co-operation.
Our political engagement has also grown stronger through regular political and parliamentary exchanges. In June, the President of the European Parliament, Roberta Metsola, for the first time addressed the Federal National Council in Abu Dhabi. Soon thereafter, and following months of joint efforts, the European Parliament decided to remove the UAE from its list of high-risk third countries with strategic deficiencies in their anti-money-laundering legislation. This recognition of the progress made by the UAE in this area also stands as a testament to the enduring resilience and adaptability of European democracy. I am confident that our co-operation on this issue will continue to strengthen.
Nevertheless, diplomacy is not about progress only – it is also about facing challenges together. We are both navigating an increasingly volatile global landscape. War looms at our doorstep, and as Ms Metsola stressed during her speech before the FNC: “History has taught us that when the world feels like it is on fire, it is not enough to contain the flames. We need to extinguish them.”
When I arrived in Abu Dhabi two years ago, I sensed great potential in our partnership. However, what we have witnessed since then has gone far beyond potential – it has been a true transformation
Russia’s war in Ukraine remains the most pivotal and potent challenge for Europe’s future because it is not only the destiny of Ukraine that is at stake, but also European destiny. Having learnt through hardship, we believe that every country should have the freedom to shape its own future, and that borders must never be changed by force. The ripple effect of this war is already felt globally.
Our dedication to peace and co-existence also guides our approach to the Middle East. The EU is deeply concerned by the ongoing conflicts in the region, particularly the devastating humanitarian toll they are taking. The war in Gaza has brought appalling suffering to Palestinian civilians and continuous uncertainty for Israeli hostages and their families. The EU and UAE share a common goal: to restore the ceasefire that can lead to a just and lasting peace. The Emirates has played a vital role as a partner for diplomacy, humanitarian assistance and regional stability. We continue to be firm advocates for a two-state solution, based on mutual recognition and peaceful co-existence.
As I reflect on the past two years, I see more than just milestones reached. I see a relationship that is growing in confidence and clarity. This is just the beginning of a new chapter, one marked by openness, ambition and mutual respect. The path ahead is full of potential, and I look forward to shaping it alongside our Emirati partners, with the same spirit of co-operation that has brought us this far.
MATCH INFO
Manchester United 6 (McTominay 2', 3'; Fernandes 20', 70' pen; Lindelof 37'; James 65')
Leeds United 2 (Cooper 41'; Dallas 73')
Man of the match: Scott McTominay (Manchester United)
Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer
Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
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The biog
Born: Kuwait in 1986
Family: She is the youngest of seven siblings
Time in the UAE: 10 years
Hobbies: audiobooks and fitness: she works out every day, enjoying kickboxing and basketball
RIVER%20SPIRIT
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Emergency
Director: Kangana Ranaut
Stars: Kangana Ranaut, Anupam Kher, Shreyas Talpade, Milind Soman, Mahima Chaudhry
Rating: 2/5
Pad Man
Dir: R Balki
Starring: Akshay Kumar, Sonam Kapoor, Radhika Apte
Three-and-a-half stars
Director: Laxman Utekar
Cast: Vicky Kaushal, Akshaye Khanna, Diana Penty, Vineet Kumar Singh, Rashmika Mandanna
Rating: 1/5
The bio
Favourite book: Kane and Abel by Jeffrey Archer
Favourite quote: “The world makes way for the man who knows where he is going.” - Ralph Waldo Emerson, American essayist
Favourite Authors: Arab poet Abu At-Tayyib Al-Mutanabbi
Favourite Emirati food: Luqaimat, a deep-fried dough soaked in date syrup
Hobbies: Reading and drawing
It Was Just an Accident
Director: Jafar Panahi
Stars: Vahid Mobasseri, Mariam Afshari, Ebrahim Azizi, Hadis Pakbaten, Majid Panahi, Mohamad Ali Elyasmehr
Rating: 4/5
The Settlers
Director: Louis Theroux
Starring: Daniella Weiss, Ari Abramowitz
Rating: 5/5
How to help
Send “thenational” to the following numbers or call the hotline on: 0502955999
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6027 – Dh 100
6026 – Dh 200