Bilal Sabouni, Executive Vice-President of the American Business Council of Dubai and the Northern Emirates (ABC Dubai), discusses the US-UAE bilateral business and trade relations that have made the UAE America’s largest export destination in the region.
Could you please provide an overview of the bilateral relations in terms of business and trade between the US and the UAE?
The US has enjoyed a wonderful, mutually beneficial relationship for business and trade with the United Arab Emirates for many decades now. In fact, despite being halfway around the world, the United States was the third country in the world to recognize the United Arab Emirates as a sovereign nation in 1971.
It was this recognition that paved the way for a number of historic ‘firsts’ for the then young UAE. As a new nation, the UAE’s first established hotel in 1972 was a great American brand, the Hilton. This predated the establishment of the American Business Council (ABC), which is celebrating its 30th anniversary this year, by an additional 13 years. It was a historic and important moment that helped usher in the beginning of an open, hospitable, and welcoming nation.
With the establishment of the ABC in 1985, we have had the fortune of bearing witness to many great moments in commerce and trade across all major sectors, including healthcare, academia, sports and culture, energy, transportation, food & beverages, logistics, and many others. It was in December 1994 that the first McDonald’s was opened in Dubai. In 1995, the first academic institution, the American University in Dubai was founded, and a decade later, we see the likes of the Nasdaq opening and Bloomingdale’s establishing their first international location outside the US here. In air transport, Delta was the first to establish a non-stop connection between Dubai and Atlanta, and today, the UAE carriers conduct over 250 flights a week to cities all across the US.
The commercial relationship continues to strengthen as the two countries continue engaging with one another. Last year marked yet another year with the UAE being the US’s largest export market in the region, surpassing Saudi Arabia and even India to the East.
Since you mentioned Delta, what is your perspective on the escalating row between the US and Gulf carriers? What do you think could be the potential consequences in the aviation sector for both countries?
That is a good question, and you highlighted a very important point within that question, which are “the consequences”. The consequences of an escalating dispute may include an attempt to end the Open Skies treaty, and in my opinion, the consequences of that are negative for all. The advantages of keeping this relationship intact by far outweigh the reasons to eliminate it. I believe this row will deescalate over the coming weeks and months and will continue to take a backseat to the direct and indirect economic advantages stemming from the positive impact that the treaty brings to everyone.
What do you think Expo 2020 can represent in terms of the US-UAE relations?
The Expo will put a spotlight on the evolution of the UAE economy, presenting a platform to highlight past achievements as well as current and future commercial opportunities – especially those focused on the core theme ‘Connecting Minds, Creating the Future’ and subthemes of ‘Opportunity, Mobility, and Sustainability’.
As mentioned earlier, many historic moments across the UAE’s economic timeline has involved US companies and their products, services, and know-how. Large organizations are likely already operating in the country, but small to medium-sized businesses not already here could take advantage of Expo 2020 to leverage on the trust already established between the US and the UAE to replicate past success.
The UAE has a seemingly unending desire for growth towards offering a world-class cosmopolitan society embodying traditional values and a welcoming philosophy of openness and acceptance for all. We look forward to participating in the Expo and supporting its success, the efforts of the UAE’s organizing committee, and all stakeholders involved.
What kind of role and activities do you carry out in terms of raising awareness about the importance of this event?
I’m the American Business Council of Dubai and the Northern Emirates Vice Co-Chair, and member of the US Standing Committee, which was established to support Expo 2020 and the UAE’s organizing committee. As time gets closer to the actual 2020 launch date, we will get more involved with promotion and awareness to ensure that this prestigious event receives the publicity and awareness that it deserves within our stakeholder community and the general public at large.
What is the current American presence in the free zones in Dubai and Northern Emirates?
This is a difficult question to answer. There are over 1,000 US corporations with operations in the United Arab Emirates. Mapping them to specific free zones can be a difficult task without an up-to-date public registry across all these zones. In fact, it can sometimes even be a difficult task just to keep track of how many free zones there are to start with due to the vast number continuously being proposed and launched across the country.
Today, there are over 40 free zones in the UAE with the vast majority of them being in Dubai. These commercial hubs have been very popular with Americans and American corporations. More and more, US businesses seem to prefer locating themselves in these free zones due to the familiar working environment and flexible regulatory frameworks that allow these companies the freedom to operate the way they feel is best for business in the region. Some of the most recognizable free zones in the UAE include those in healthcare, technology, media, education, finance, commodities, logistics, and many more.
Everyone considers the US as a strategic partner in terms of innovation. Does this match the composition of trade export of the US towards the UAE?
In recent years, innovation has been a key component, and in some cases, even a requirement, to doing business in the UAE. I have seen government commercial agreements where innovation and knowledge transfer has been a mandate. I have also seen business plans and projects rejected because a lack of new thinking and new ideas.
The US continues to be a well-respected and trusted source of innovation and international best practice for the Emiratis. With the increase in the number of US corporations and Americans exporting their products, services, and know-how, we see the appetite for innovation growing in turn. The UAE has a long-term plan to transition from a net importer of innovation to a net exporter of innovation as a knowledge and innovation-based economy. The US has a great opportunity to continue being a leading player in catering to these needs and supporting the UAE’s evolution.
You mentioned healthcare at the beginning of the interview. Right now, we see that UAE’s healthcare needs probably 8 billion by the end of 2015 to match the requirements in the sector because there is this projected growth of 160% for beds by 2025. ABC every year holds some major events. Do you have some key studies of excellence of the American Health Organization that have brought very much needed knowledge transfer.
The ABC conducts an annual Arab Health Breakfast, which coincides with Dubai’s Arab Health conference and exhibition, which brings together professionals from the healthcare industry as well as senior government leaders in public sector healthcare. Moreover, healthcare is a common subject in our annual I.D.E.A.S. Business Forum and the topic features in many of the calendar of events that we hold.
From a knowledge and technology transfer perspective, we have a number of case studies of successful healthcare ventures in the UAE. One of the earliest was the establishment of the American Hospital in Dubai, which has attracted cutting-edge technology and best-in-class medical practitioners to the country.
The American Hospital in Dubai has just opened up a new clinic in the city. They are expanding and hiring a new team of medical experts. Their success is apparent in their longevity and growth. Another case to watch is that of the Cleveland Clinic in Abu Dhabi – another excellent US healthcare institution aiming to be a top-class healthcare provider in the region. Quality and innovation are pillars of their value proposition, and you can see this as soon as you walk into their building. These are just two examples, but of course there are many more.
What do you think is the American contribution to facilitate the UAE’s transition towards a knowledge society?
Today, the UAE is a net importer of innovation and knowledge, but as mentioned earlier, the country is very rapidly transitioning towards the goal of becoming a net exporter of knowledge, talent, and innovation. The UAE is eager to establish itself as a hub of locally formed international best practice and innovation – but I think they recognize that they are not there just yet. Every government leader that I have met with has been extremely modest in their views on where the UAE currently is in its development, and they hold a very humble perspective on what they have achieved so far. However all have been very excited and optimistic at what the UAE will achieve in the future.
That excitement and energy is something that the American community is proud to be associated with. Innovation is an absolute key component of a knowledge economy. And as I said earlier, as the US will continue to invest in the region – and specifically in the UAE and its people – I am confident that soon enough the UAE will achieve its objective to become a fully fledged knowledge economy, and ultimately a net exporter of innovation and expertise to the rest of the world.
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