East or West: The UAE’s Balancing Act with China and the US

Abu Dhabi is trying to preserve its economic and security interests as the superpowers’ rivalry grows, a new Middle East Policy article explains. 

Earlier this week, United Arab Emirates (UAE)-based artificial intelligence company G42 announced that it is continuing to scale back its presence in China and is pivoting to focus on Western markets following American pressure over its relationship with Beijing. According to the company’s CEO, “all of [its] China investments that were previously made are already divested” and it has since prioritized working with US-based corporations. 

The pressure on G42 may be new, but connections with China, and American concerns, are not. As Beijing’s presence in the Middle East has grown over the years, so have its relations with Abu Dhabi. In 2020, the Emirates became China’s primary trade and investment partner in the region, and the two states maintain a comprehensive strategic partnership.  

The partnership is one of the many signs that the Asian superpower is not only economically invested in the UAE, but politically as well. In a new article in Middle East Policy’s Spring 2024 issue, Mohamed Bin Huwaidin explores this expanding relationship and how Abu Dhabi is working carefully to balance ties with both Beijing and its existing partner in Washington. 

The US has long been the UAE’s most vital security partner, with the Gulf state playing host to multiple US military centers and a support role for its military action in the region. At the core of this partnership is Abu Dhabi’s concern over the threat from Iran, whose influence is considered to be minimized by American presence in the Gulf. 

But the UAE has not hesitated to also welcome China’s engagement in the country and wider region despite the ongoing Sino-American rivalry. To the Emiratis, Bin Huwaidin explains, “China does not pose a security threat or challenge…nor is it perceived to have a revisionist agenda aimed at altering the regional status quo,” focusing instead on stabilization. Another key consideration in improving ties is “to prevent [Beijing] from fully supporting Iran,” two countries whose relationship has also improved in recent years. 

China is critical to the UAE’s economy. As a commercial superpower, it offers not only increased trade and investment, but an opportunity for economic diversification and reduced reliance on Washington. The Emirates’ desire to expand into “financial and knowledge-based industries…requires increased collaboration with China, a recognized leader in the digital economy,” the scholar asserts. 

One of the biggest developments of the partnership was the UAE’s adoption of Chinese-based tech giant Huawei’s 5G technology. In 2021, Abu Dhabi signed an agreement with Washington to purchase advanced military equipment from the US, but the $23 billion deal was put on hold as the Biden administration raised concerns that the Huawei tech could be used to “gather intelligence on the F-35 and…be a conduit for Chinese intelligence.” Despite the protest, Abu Dhabi made the decision to maintain the technology rather than complete the arms deal. 

This is one of the many major choices the UAE has had to make in recent years, despite the threat to its relationships. The Gulf state continues to perform a balancing act: as the diplomatic advisor to the president declared, its “trade relations are increasingly looking to the East, while our primary security and investment relations (are) in the West.” 

Bin Huwaidin notes that “the UAE understands that it has no control over the geopolitical rivalry between the United States and China.” The country’s only choice now is how to carefully balance its relationship with both powers. China has not claimed at any point that it intends to take on a security role in the region, so the UAE must work to maintain American security cooperation while also profiting from the increasingly scrutinized trade and technology ties with China. Even with the difficulties, Abu Dhabi views the partnerships as essential to its goal of diversification. 

Despite its success so far, the scholar argues, the “continuing rivalry and mutual distrust between the United States and China may force the UAE to take a stance” sooner rather than later. 

Among the major takeaways readers can find in Mohamed Bin Huwaidin’s Middle East Policy article, “UAE’s Balancing Strategy Between the United States and China”: 

• The UAE is seeking to manage ties with both the US and China to pursue its strategic and economic ambitions. 

• The UAE’s primary ties with the US are security-based. 
  • Within the UAE are located multiple US military centers and both states actively cooperate on military action in the region. 

• At the core of the Washington-Abu Dhabi relationship is the shared concern over Iran’s strength – the UAE wants the US to maintain a presence in the Gulf to protect from Iranian influence. 

• The UAE’s relationship with China is both economic and political in nature. 
  • Abu Dhabi has a comprehensive strategic partnership with Beijing, the highest level of diplomatic relations, which indicates a partner that is politically, economically, and militarily important to its interests in the long-term. 
  • The UAE is China’s primary trade and investment partner in the Arab world. 
  • The countries have established an investment cooperation fund to improve Belt and Road Initiative projects and the UAE’s digital expansion. 
  • They are also partners in projects focused on clean energy and new technologies like artificial intelligence. 

• Political ties between China and the UAE have begun to be cemented in recent years. 
  • Abu Dhabi aims to balance Beijing’s longstanding ties with Iran to avoid too close a partnership between them. 
    • At the same time, the UAE is supporting US efforts to contain Iran. 

• Despite the benefits, growing cooperation with China on technology has increasingly come under scrutiny from the US. 
  • The UAE was the first in the region to adopt Chinese tech giant Huawei’s 5G technology, a move heavily criticized by Washington. 
  • Abu Dhabi was negotiating a purchase of American military technology, but the deal was paused because of the worry that Huawei technology would be used alongside American arms, a concern deemed too high a security risk.  

• The UAE’s balanced approach to the US and China can be attributed to five factors: 
  • An acknowledgement of Sino-American competition and a desire to protect its interests rather than taking sides. 
  • The utilization of a balancing framework to prioritize their interests but maintain positive relations with both superpowers. 
  • The lack of significant American pressure on the UAE to choose a side. 
  • Longstanding security partnerships with other countries provide the UAE with additional flexibility on security and economic choices. 
  • A serious effort to avoid instigating hostility from China. 

You can read “UAE’s Balancing Strategy Between the United States and China” by Mohamed Bin Huwaidin in the early look at the Spring 2024 issue of Middle East Policy. 

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