UAE and Austria Look Set to Diversify Economic Relations

The UAE and Austria have established strong friendship bond and both the nations are determined to further strengthen bilateral trade and investment in coming years, according to a senior official.

Markus Susilo, a Trusted Tax and Business Advisor of the Commercial Section of the Austrian Embassy in the UAE, said both countries will not only promote existing relations in petrochemical, energy and infrastructure but they are keen to explore new avenues and sectors to diversify their economic relations.

“The UAE is not only important for Austrian export industry as a market itself, but the emirate is also vital because of its strategic location and hosts a number of international trade fairs and exhibitions and its catchment area extends from the Indian subcontinent to Africa,” said Susilo, who is also Partner at Crowe.

The Austrian investment in the UAE rose significantly to record 11.2 billion euros in 2022, showing a growth of 110 per cent year-on-year growth, according to official data released by Austrian National Bank OeNB.

The major share of this investment is invested in petrochemical sector and the UAE secured 7th place in the list of the most important destinations for Austrian direct investments. The UAE’s investment in Austria also rose 7.6 per cent to 8.84 billion euros in 2022, according to Foreign Economy Centre Abu Dhabi report in November by commercial section of Austrian Embassy.

The Austrian exports to the UAE also rose 23.5 per cent to 657.7 million euros in 2023 as electrical machines’ exports surged 7.4 per cent to 175.7 million euros followed by boilers, machinery, apparatus and mechanical devices around 122.7 million (+60.9 per cent) and vehicles approximately 69.9 million euros (+0.8 per cent).

Austrian imports from the UAE also rose 20.6 per cent to 235.9 million euros last year. The main imported products included electrical machines and electrical engineering goods, mineral fuels and mineral oils and art objects.

Solid foundation

Susilo said the Bilateral Investment Treaty, (BIT), which was signed on June 17, 2001, is one of the decisive factors for the excellent economic relations between the UAE and Austria.

“The BIT has provided and will continue to provide the foundation for intensive trade relations between the two countries and for safe legal and economic environment for their investors,” said.

Many major economic players in both countries have engaged in mutual investments, especially in the petrochemical, hospitality, and healthcare sectors. The UAE is Austria’s largest trading and business partner in the Gulf region as many Austrian companies choose to establish key manufacturing bases in the UAE, supplying not only the local market but also the entire GCC and Mena region.

“We have seen many Austrian companies contributes to the infrastructure development of the UAE. Some of the major projects include the construction of Al Maktoum Bridge, Louvre Abu Dhabi, and involvement of Doka in construction of the world’s tallest building Burj Khalifa, among others,” he said.

In addition, the Austrian oil and gas giant OMV is working closely with Adnoc in energy sector. “Both countries have signed many bilateral agreements to further strengthen their relations,” he said.

To a question about major factors behind the strengthening of economic ties, he identifies three sectors that promote trade and investment between the two countries. “Energy, engineering and construction sectors played key role in establishing strong ties between the two countries,” he said

Susilo said the UAE and Austria are exploring cooperation in other sectors to expand their trade and investment relations in the years to come.

Elaborating, he said Austria has experience in tourism sector that can be shared with the UAE to develop their industry. He also highlighted education and health as other potential sectors where both the countries can increase their cooperation.

“Austria provides dual education at the high school level that combine theory and technical practice at the very young age to train someone to be a good engineers. There is no second opinion that Austria is good in managing healthcare centres and quality education for medical workers such as doctors,” he said.

“Both nations can also explore environmental technology such as waste management to strengthen their existing relations,” he added.

Susilo was of the view that the Austrian Government is actively supported and facilitated business activities and partnerships between Austrian companies and their UAE counterparts.

“Austrian Government has established the Advantage Austria as the commercial arm under the Austrian Chamber of Commerce to promote bilateral trade. This organisation facilitates promotion and prepares business delegations to attend trade exhibitions,” he said.

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