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The five-party summit last August in El Alamein, northwest of Cairo on the Mediterranean coast, was not the first for five Arab leaders. The UAE, Jordan, Iraq, Bahrain and Egypt have met to coordinate positions and discuss regional challenges.
Similar meetings have been held recently at different levels with fewer participants. But what’s important about the recent summit is the UAE’s role as an active member of the promising economic alliance launched a few years ago by Egypt, Jordan and Iraq.
In a rapidly changing regional and global situation, the three countries decided to focus on economic complementarity to promote investment, trade and resource sharing. Focusing on common ground, these countries see an opportunity to approach cooperation at a time when the region faces the challenge of division.
But inherent problems and regional challenges remain. Egypt, with great economic potential, was affected by the war in Ukraine. As the largest food importer, the country is grappling with broken supply chains, falling tourism receipts and ballooning foreign debt.
It is now under pressure from the International Monetary Fund to devalue its currency as a condition of receiving additional aid and much-needed loans. A weaker currency could lead to more trouble as the country grapples with soaring inflation. Much of Egypt’s external debt is due to investments in the country’s infrastructure and projects that will boost the economy and GDP over time.
Egypt needs smart investments, and the UAE is stepping in. In August last year, it was announced that the value of trade exchanges between Egypt and the UAE would increase to about $1.2 billion in the first quarter of 2022, a 1.4% increase over the 2021 period.
Egyptian authorities announced that the value of UAE investments in Egypt increased to US$1.9 billion (AED6.98 billion) in the first half of the 2021-2022 financial year, compared to US$712.6 million (AED617 billion) in the same period of the current financial year 2020-2021 Year, an increase of 169.1%.
His Highness Sheikh Mohamed bin Zayed Al Nahyan with Egyptian President Abdel Fattah al-Sisi in El Alamein
Image source: provided
In addition, in May, Jamal Saif Al Jarwan, Secretary General of the UAE Council of International Investors (UAEIIC), was quoted as saying that the UAE looked forward to increasing its investment in Egypt over the next five years. to $35 billion. To reach $20 billion this year.
The new investments will cover many sectors, including logistics, telecommunications, oil, renewable energy and maritime activities.
For Jordan, which has historical ties to the UAE, the flow of foreign investment is key to tackling its biggest challenge today: unemployment around 23 percent and youth unemployment approaching 40 percent.
Jordan has well-educated young people and has made progress in renewable energy, with about 24% of its energy needs being green, in pharmaceuticals, fertilizers and clothing. In fact, Jordan’s phosphate and potash industries did well after the Ukrainian war.
The UAE is once again one of the largest investors in the Jordanian economy. This week, Ahmed Al Balushi, UAE Ambassador to Jordan, said that economic relations between Jordan and the UAE are booming, with UAE investments in Jordan exceeding $17 billion.
Major investments in the UAE
Investments in the UAE cover many sectors including energy, technology, military industry, tourism, education, transportation, water, agriculture and infrastructure, Balushi added, adding that trade between the two countries currently stands at $3 billion a year.
Iraq faces its own multifaceted problems. Two decades of war and political chaos have kept the oil-rich country from recovering. But like Jordan and Egypt, the UAE believes it is important to support Iraq as it struggles with economic and political uncertainty.
Last year, the UAE announced a $3 billion investment deal with Iraq to strengthen economic and investment ties. The Iraqi-UAE Business Council is being established to simplify all measures to serve both countries.
Once Iraq emerges from political infighting, it is expected to become a major hub for investors as it seeks to rebuild its infrastructure.
This new alliance represents a huge investment opportunity for the UAE and is now becoming a driving engine for the region.
With its experience in managing successful investments in almost all sectors, there is no doubt that the UAE’s contribution to the stability of Egypt, Jordan and Iraq will be fundamental and important.
Osama Al Sharif is a journalist and political commentator based in Amman.
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