UK Trade Envoy visits Arab Emirate to expand cooperation

The British Prime Minister’s Trade Envoy to the UAE, Gareth Johnson MP, accompanied by UK Ambassador to the UAE, Edward Hobart recently visited Ras Al Khaimah Economic Zone (RAKEZ). The delegation discussed trade relations between the UK and the emirate of Ras Al Khaimah and explored avenues for future cooperation and potential support for British companies looking to expand in the region.

Trade Envoys support the UK economy by supporting British businesses to take advantage of the opportunities arising from the UK’s global trade agenda. They promote the UK as a destination of choice for inward investment across all regions of the UK. Gareth Johnson MP was appointed to his role at the end of March 2023.

RAKEZ – as it is known – has a community of over 1,500 UK companies among more than 5,000 British businesses operating across the UAE. These companies span multiple sectors such as services, commercial, trading, education, manufacturing, e-commerce, and media. 100,000 UK nationals residing in the UAE and millions of annual visitors, businesses including those within RAKEZ

The delegation expressed keen interest in the higher education facilities within the emirate. They were particularly pleased to discover that four British university branch campuses reside in the RAKEZ Academic Zone. These include the University of Stirling, University of Bolton, University of West London, and Bath Spa University.

Welcoming the delegation, RAKEZ Group CEO Ramy Jallad said: “The British Trade Envoy’s visit signifies a positive milestone in the strengthening of the decades-long valued trade and investment ties between the UK and the UAE. RAKEZ already houses a great number of British companies thriving in our sustainable business ecosystem backed by our customer-centric approach and innovative business solutions, which enable them to operate seamlessly and access the growing regional and global markets. Presenting such a wide range of opportunities, we are keen to explore further avenues for cooperation with British investors.”

Potential tyre market expansion opportunities?

The UK is the UAE’s largest European trade partner as of 2022, with exports to the UK amounting to approximately US$2.34 billion. The launch of the GCC-UK Free Trade Agreement (FTA) last year is expected to further strengthen this strategic economic relationship.

The UAE tyre market is estimated to grow at a compound annual growth rate (CAGR) of 8.5 per cent between 2017 and 2027, according to BlueWeave Consulting. But, naturally, that figure doesn’t take into account the regional re-export opportunities provided by doing business with the UAE. Not only does the UAE hold an FTA with the UK, it also has preferential local taxation policies, inherent connections with other Middle East markets and further re-export opportunities across the African markets.

The UAE passenger car segment reportedly accounts for the largest market share, with passenger cars making up “more than 80 per cent of the UAE’s automotive market”, according to BlueWeave Consulting.

The UAE is also described as a high-value market due to high disposable incomes and stable fuel prices. It is estimated that there are around 3.5 million cars on the road, with Dubai accounting for a 40 per cent share.

With the UAE favouring premium brands, it is no surprise to learn that the leading players  are said to be Michelin, Goodyear, Continental, Bridgestone, Pirelli and Yokohama. It is also worth pointing out that Hankook holds a particularly strong position in the UAE. Within that, there are one or two local market idiosyncrasies. Regional market sources told T&A that, not only is the UAE a premium-leaning market, local consumers choosing a Korean tyre brand, for example, would favour a Korean-made tyre over a tyre bearing the same brand, but made in China. In both respects, UAE tyre-buying habits are said to be similar to neighbouring markets such as Saudi Arabia.