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Thursday, June 1, 2023

UAE ‘country of focus’ as US looks to target Russia’s economic partner

The United Arab Emirates is a “country of concern” because the United States wants to stifle Russia’s ties to the global economy, a senior U.S. official said Thursday, some of the strongest comments yet as Washington ratchets up its ties to Russia. pressure on its Gulf allies. Moscow.

“We’re particularly concerned about increased trade with Russia, including goods that can be used on the battlefield and those that are helping designated Russian entities,” Elizabeth Rosenberg, assistant secretary of the Treasury for terrorism financing and financial crime, told a conference. Thursday’s activities.

The comments come amid growing concern in the West that countries such as the United Arab Emirates and Turkey are providing the Kremlin with vital economic lifelines that could aid its war effort.Many missiles and drones deployed by Russia rely on components in the West.

Ukraine War: How the Middle East Became Russia’s Economic Lifeline

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As recently as December, the UAE was still exporting drones to Russia, according to Russian government data analyzed by the Washington, DC-based Free Russia Foundation. The group lists the United Arab Emirates, Turkey, Cyprus and China as countries that have “significantly expanded” exports to Russia.

Between July 2022 and November 2022, U.S. exports of controlled goods, including “semiconductor equipment, some of which could be used in the battlefield,” accounted for 30 percent of the value of the UAE’s total exports to Russia, Rosenberg said.

The UAE is trying to balance its competitive position as a longtime U.S. partner in the Middle East and a neutral business hub.

Non-oil trade between Russia and the UAE growing up A 57% increase in the first nine months of 2022 broke all records. In December, UAE Trade Minister Thani bin Ahmed al-Zeyoudi pledged to “take trade to greater heights”.

Dubai has positioned itself as an international business center where “deals trump ideals” and has benefited from the turmoil of the Ukraine war.

The city became the world’s fourth The most active luxury real estate market this year after New York, Los Angeles and London – thanks to a surge in interest from Russians, they have become Dubai’s top real estate buyers.

As well as welcoming Kremlin-linked oligarchs, Dubai has benefited from an influx of Russian tech workers, many of whom hope to avoid fallout from Vladimir Putin’s war.

The UAE is also taking advantage of Western sanctions aimed at cutting off Russia from its oil revenues. The port of Fujairah in the United Arab Emirates has become a transshipment hub for Russian crude oil and petroleum products. Last year, Russian state-owned energy giant Lukoil moved its trading operations to Dubai.

washington growing frustrated

There is evidence of Washington’s growing frustration with the UAE’s business model. Rosenberg said countries would have to choose between the West, which stood with Ukraine at the time of the invasion, and the rest of the world.

“You can do business with countries that account for more than 50 percent of the world’s GDP and have the most convertible and stable currencies, or countries that facilitate Russia’s wars,” she said.

U.S. sanctions have a significant impact because of the dollar’s dominance in global trade. The Swift Financial Information System, which facilitates remittances, also relies on U.S. banks.

How an influx of war-weary Russians is energizing Dubai’s tech scene

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Some analysts and sanctions experts predict that the Ukraine war will hasten a chain reaction that pushes countries such as the United Arab Emirates away from Western sanctions.

Cinzia Bianco, visiting scholar at the European Council on Foreign Relations, told MEE an earlier story The Ukraine war has been viewed by Gulf states such as the United Arab Emirates as a “testing ground” for a larger showdown between China and the United States that is expected to unfold.

“The war gave the Gulf countries an opportunity to think about protecting their systems through sanctions,” she said.

Last week, the US imposed sanctions on a Russian bank operating in the country United Arab EmiratesThe move by the UAE Central Bank to grant it a license is seen as a sign of growing Russian influence. The central bank said MTS “helps support legitimate trade between the two countries and serves the Russian community in the UAE”.

The recent spat over Abu Dhabi’s independent foreign policy streak comes after Washington clamped down on the UAE’s trade with Russia.

Emirati companies have been sanctioned by Washington for helping Iran evade sanctions. The UAE is also moving closer to China militarily.Abu Dhabi in talks with Washington to purchase F-35 fighter jets anchor out of concern that Beijing will gain access to sensitive U.S. technology.

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