France and the UAE over the last few years have expanded bilateral ties, growing the relationship historically rooted in the energy trade. Now, the focus is on the trade of other goods, continuing to share culture, boosting FDI, and collaborating across sectors including health, education, transport and space exploration. The evolving relationship will also prioritise private sector engagement between the countries.
The relationship’s shifting nature has unlocked new opportunities for the private sectors in both countries to engage with their counterparts. Further, the creation of the UAE-France Business Council will be the bedrock of future private sector cooperation. The council is chaired by Dr Sultan Al Jaber and Patrick Pouyanné and aims to strengthen the economic relations between the two countries in the fields of energy, transport and investment.
At the council’s inaugural gathering in July 2022, French Finance Minister Bruno Le Maire said the countries are working to strengthen their economic relationship, with “concrete outcomes” expected in the near future.
In the same month, France and the UAE signed a strategic agreement to cooperate in the energy sector. The partnership aimed to identify joint investment projects in France, the UAE or elsewhere in the sectors of hydrogen, renewable and nuclear energy. The cooperation on the energy front is a continuation of an ongoing partnership. In 2017, ENGIE made an investment of approximately Dh2.8bn by acquiring 40% of UAE-based Tabreed’s shares, making it the world leader in district energy.
They also signed agreements for cooperation on education, climate action, public health and lunar exploration. The relationship between the nations goes back to the year 1975, just four years after the formation of the UAE.
Already, there are more than 600 French companies working in the UAE, a number that climbs by roughly 10% annually, according to analysis from the Brookings Institute. In 2021, bilateral trade between the UAE and France reached Dh25bn ($6.81bn), an increase of 25.9% from the previous year.
The Paris-Sorbonne University Abu Dhabi was established in 2006 and the Louvre Abu Dhabi opened in 2017, the projects serving as examples of the ongoing culture trade that has been robust for nearly two decades. In 2019, the Emiratis financed the restoration of the 19th-century theatre, which had sat unused for 150 years at the castle at the Chateau de Fontainbleau outside Paris. Former UAE President and Ruler of the emirate of Abu Dhabi, the late Sheikh Khalifa bin Zayed Al Nahyan, saw the abandoned theatre in 2007 while on a state visit in France and offered €10m for its restoration.
To understand more about the history of this relationship, as well as the future of UAE-France bilateral relations, Investment Monitor sat down with Guillaume Hallez, country head of the Abu Dhabi Investment Office’s (ADIO) France office.
How would you describe the governmental and trade relationships between France and Abu Dhabi?
The first state visit taken by Sheikh Mohamed Bin Zayed Al Nahyan when he took over as the president of the UAE was France. The destination was chosen specifically because of the strategic nature of the relationship between our two nations. This visit is a statement in itself. France and Abu Dhabi have been close partners for decades. As the visit shows, those ties have only deepened in recent years.
From a trade point of view, they are also excellent. With more than 600 French companies established in the UAE as a whole, trade between the two countries has been growing steadily over the years. The UAE is France’s second-biggest trading partner in the region.
The UAE capital’s advanced physical and virtual infrastructure and progressive regulations enable real innovation and deeper private sector involvement in the economy. Recent examples include Veolia, which has won a tender for a waste management project, and Engie and EDF, who won a tender through Abu Dhabi’s public-private partnership framework. Abu Dhabi has also been a major investor to France with several initiatives led by Mubadala with both private and public partners such as the Bpi. Mubadala is directly or indirectly investing billions of euros in French companies big and small.
What are the standout sectors in France-Abu Dhabi trade?
Historically, the main sectors of cooperation have been oil and gas. However, Abu Dhabi’s diversified economy and dynamic investment environment has created new opportunities for French businesses to thrive, encompassing culture (the Louvre), education (the Sorbonne, INSEAD) and high tech such as HealthTech, ICT, district energy and AgTech.
Finance is also a fast-growing sector. Abu Dhabi Global Market (ADGM), one of the world’s premier international financial centres, has been working closely with European and French regulators for many years. It offers a safe, well-regulated environment for funds to establish themselves and it gives them access to the wide pool of local investors.
What opportunities do Abu Dhabi and ADIO offer France businesses? What makes Abu Dhabi the perfect place for French companies to do business?
Abu Dhabi’s unrivalled connectivity offers businesses a proven expansion ground and global launchpad. As well as access to 80% of the world within eight hours, Abu Dhabi is one of the easiest places in the world to do business because of a positive investment environment, enabling regulations, stability and security, access to talent, liveability and cutting-edge infrastructure. With Vision 2030 and the challenges to meet the net-zero pledge by 2050, the emirate is going through a new transformation, 50 years after its creation. This brings endless opportunities for French businesses, and ADIO is there to help them start, scale and succeed in Abu Dhabi.
Once in Abu Dhabi, French investors will enjoy one of the best cities in the world for expats, a city that has been consistently ranked the safest in the world and that provides access to top French schools and world-class museums like Louvre Abu Dhabi.
Do you have any examples of company success stories?
ADIO’s Paris offices help French investors understand the market, pinpoint opportunities and move quickly. Since opening, we have seen several companies establishing a presence in the UAE, big and small. The most recent one is Ardian, a big financial player. Its long-term commitment to the region and Abu Dhabi in particular has seen a massive acceleration since its establishment at ADGM. More will be announced in the not-so-distant future.
How do you envision the future of the trade relationship between France and Abu Dhabi? How will the opportunities for businesses develop in the coming years?
Abu Dhabi’s dynamic investment environment is creating new opportunities for French businesses to thrive. With Vision 2030 and the net-zero pledge for 2050, opportunities are multiplying for French businesses in the field of cleantech, ICT and healthtech, among many others. We can see that this has been well understood by the French business community. A growing number of financial players from France are setting up in Abu Dhabi and bringing their portfolio companies with them. Abu Dhabi has the ambition to become a sustainable knowledge-based economy and the financial strength to realise it, but it also knows that its success will come faster through sustainable partnerships with world leading companies, such as the one we can find in France.
What is the role of ADIO’s France office in helping companies access these opportunities?
ADIO is the entry point for investors into the capital. We support investors and businesses with innovation at the core to help ensure long term, sustainable success in Abu Dhabi and across the region.
Our role is really to help businesses understand and access the local ecosystem and manage the end-to-end investor journey, ensuring the seamless establishment of new legal entities, the mobilisation of employees and the efficient start of your growth journey with Abu Dhabi. Investment Monitor