The New Nexus of Innovation
The UAE’s strong relationship with India and China is a sign of the shifting global center of innovation.
By Xische Editorial, August 24, 2019
An unprecedented shift is taking place in the global economy. For the first time in decades, the lion’s share of gross domestic product (GDP) creation is shifting from the West to the East. In other words, emerging markets are producing a greater share of GDP than their counterparts in the West. This means new centres of economic power are on the rise. Countries such as India and China are the focus of growth.
As these countries continue to transform the global economy, smaller countries find themselves in exciting new positions. The UAE is one such place and a recent flurry of diplomatic activity underlines how the country is leveraging its position as a nexus between East and West at a time of historic transformation in the economy. As the country continues to build its knowledge economy at home, it is bolstered by fresh alliances and partnerships with new leaders of innovation in the global economy. The volume of trade deals and partnerships signed over the last month highlight how these new alliances will come to define statecraft and technological innovation going forward.
This week, HRH Sheikh Mohamed Bin Zayed, Crown Prince of Abu Dhabi, welcomed Indian Prime Minister Narendra Modi to the UAE on a state visit. The two leaders discussed the deep and unshakable bond between the two countries which has lasted decades. Among a host of other trade deals, Mr Modi launched a new Indian payment scheme in Abu Dhabi called RuPay.
The new payment platform will cut transactions cost to a minimum and its launch in the UAE underlines the critical role that the remittance economy plays in the relationship between India and the UAE. In the wake of Facebook’s launch of its own payment platform and currency called Libra, we argued that the UAE is uniquely positioned to be a major player in the remittance market. RuPay, which will be issued by three UAE banks, is a step in the right direction. If the UAE can help transform the payments market in India, it will be able to export that knowledge to other markets in the midst of their digital changes.
Mr Modi’s visit to Abu Dhabi comes just weeks after a high-level Emirati delegation led by HRH Sheikh Mohammed Bin Zayed travelled to China. The visit underscored close ties between the UAE and the world’s second-largest economy and was punctuated by meetings between Shiekh Mohammed and Chinese President Xi Jinping. A dizzying number of deals between UAE and Chinese businesses were also announced.
More than 16 agreements in the areas of the economy, oil, education, and the environment were signed during the visit including a deal between Dubai’s Emaar Properties and Beijing’s Daxing International Airport for an $11bn residential project around the airport. Emaar will additionally open an office in the Chinese capital to facilitate more projects.
On a political level, the UAE and China underscored their deep alliance and willingness to continue cooperation on several critical levels. However, it was the discussions around technology that were more interesting. As a world leader in artificial intelligence, the Chinese sector can offer UAE counterparts an incredible amount of insight as the UAE continues to refine its own knowledge economy.
Consider deeper cooperation in food security and education. It was announced that the UAE Office for Future Food Security and China's Ministry of Agriculture and Rural Affairs in the Inner Mongolia Autonomous Region will work on two projects to ensure food security advancement, and integrated farming systems. The two countries also signed an agreement to introduce the Chinese language in UAE education curricula while the Department of Culture and Tourism - Abu Dhabi signed an agreement with the National Museum of China.
It has been said that the world’s leading innovators have refined their craft by copying others. Steve Jobs didn’t invent the Mp3 player or the mobile phone. He used existing templates and tweaked the design to create the iPod and iPhone. On a national level, cooperation leads to similar results. China is one of the most advanced countries in the realm of technology and through these new partnerships UAE companies will be able to learn what works and what doesn’t in the Chinese market.
One can think of no better way to help the UAE’s knowledge economy. Despite the turbulence in the global economy and the threat of trade wars, the fact is that cooperation in emerging markets remains strong. The gift of technology that brings people closer together is helping foster the next great innovation. The UAE’s deep partnerships with two of the leading countries in this new epoch mean the country will be at the heart of that great innovation.