UAE sets the tone that its long-term prospects are in good shape

Abu Dhabi easily edged out Riyadh in this week’s edition of the Business As Usual Sweepstakes, packaging together a string of announcements that put Saudi on the back foot. The UAE’s economy may be taking it on the chin right now — it’s been much more sharply hit than has Saudi — but it’s sending a clear message: Our long-term prospects are stronger than the rest of the GCC. (If, indeed, the GCC in its current form is even recognizable two years down the road…)

The receipts: In its first post-OPEC week, the Abu Dhabi ran Make It in the Emirates, a business extravaganza that ended yesterday with some USD 60 bn worth of contracts, finance, and offtake agreements packaged for the cameras. Capital Group and Man Group became the latest top global financial services outfits to announce they would open in ADGM. And Brookfield Asset Management and Alshaya signed a 480k sq ft joint venture to build a massive mixed-use development in Dubai Hills.

The UAE sent one of the officials the global business community trusts most to set the ‘frame’ for it all: Yousef Al Otaiba, the UAE’s ambassador to Washington, penned an op-ed piece for the FT explaining what tied it all together: Using oil revenue to fund the post-oil economy, from manufacturing and new energy to financial services, real estate, and advanced technologies, including AI.

What did Riyadh deliver this week? PIF placed a bond that was heavily oversubscribed (see story below) and that was … about it?

Manufacturing was the spine. ADNOC’s Industrial Resilience Program packaged five mechanisms — Local+, ICV+, ADNOC Multiplier, Build-to-Demand and an enhanced in-country value program model — alongside a 70-name supplier list and an AED 90 bn local-manufacturing target by 2030.

Ta’ziz, ADNOC and ADQ’s world-scale chemicals and transition fuels hub, had its coming-out party, closing USD 2 bn of financing for its Ruwais methanol plant from an 11-bank syndicate. It also signed a USD 10 bn chemicals JV with Alpha Dhabi, and locked in 5-25-year offtake and feedstock agreements totalling USD 28.5 bn. Tawazun, the UAE’s defense and security industry champion, and AD Ports launched the Al Selmiyyah Defence Industrial Free Zone — not a procurement deal, but a full defense manufacturing cluster, as we discuss below.

Abu Dhabi showed the Emirates has the financing depth to match its ambitions. Domestic banks pledged AED 18 bn at this year’s iteration of MIITE — on top of AED 40 bn in long-term finance they pledged last year. Our friends at Mashreq made the single biggest commitment at AED 10 bn — five times what it pledged in 2025 — targeting green loans, sustainability-linked facilities, supply-chain finance and trade finance. Emirates Development Bank committed AED 6 bn and Dubai Islamic Bank AED 2 bn.

“Demand from manufacturers for capex, working capital, and trade finance has scaled materially” as the UAE’s industrial agenda matures, Mashreq’s Shakil Haider, the bank’s head of services and manufacturing, tells us. The new commitment is “deliberately structured to span the full industrial value chain,” with the bulk likely flowing to strategic-autonomy sectors — food security, large-scale industrials, pharma and advanced manufacturing.

Global capital’s love affair with the UAE hasn’t cooled with the war: Capital Group (USD 3.3 tn AUM) and Man Group (the world’s largest publicly-traded hedge fund) both made commitments to ADGM this week. They follow Rokos Capital, Bain Capital, and Hillhouse, all of which signed in over the past month. (That comes after Citadel said it would open in DIFC and BNY said it would do institutional crypto custody at ADGM). The world’s biggest money managers can go anywhere, and they’re choosing to rent in the UAE — during a regional war.

Dubai property held the line. Brookfield, with c. USD 1 tn AUM, and Alshaya — the Kuwait-based operator in MENA+ of many of the West’s best-known mall brands — signed a Dubai Hills JV combining Grade A office, build-to-rent residential and retail.

The UAE’s push is impressive when you consider the hit it has taken. Foreign investors pulled USD 120 bn out of the country earlier in the conflict. Ratings agencies see the economy contracting, the UAE PMI hit a five-year low this week, and EGA’s Al Taweelah facility remains in force majeure. But the UAE knows crisis management — and it is hard to think of a government with better PR chops. This week was fundamentally about resetting the narrative.