Germany and UAE Eye Stronger Economic and Defense Ties Amid Growing Regional Security Challenges

Air defence, energy, and advanced robotics are key industries set for expansion and investment as Germany’s new ambassador focuses on deepening bilateral ties with the UAE. Ahead of a state visit to Germany by President Sheikh Mohamed on Wednesday, ambassador Tobias Tunkel stated that his nation is a committed trading partner with ambitious plans to advance innovative technologies. Mr Tunkel aims to see bilateral trade surpass its current level of approximately $15 billion during his tenure, which started in August.

There is substantial untapped potential in combining the UAE’s artificial intelligence expertise with Germany’s industrial manufacturing strength. Historically recognized as Europe’s industrial powerhouse, Germany sees increasing value in non-oil trade to reduce reliance on volatile oil prices and external factors. Mr Tunkel noted that bilateral trade growth remains stable and represents only the beginning of a much larger potential. As mutual investments diversify, both nations will focus heavily on innovative technologies, particularly emerging AI physical robotics that combine German industrial bases with advanced artificial intelligence.

Addressing regional hostilities amid the ongoing crisis involving Iran, Mr Tunkel highlighted that the UAE and Germany have grown closer due to shared threats from aggressive neighbors. Pointing to the impact of Russian actions in Europe and the exchange of drone warfare tactics between Russia and Iran, he emphasized that these threats are deeply interconnected. This was underscored by a recent incident at Leipzig Airport involving a bomb-laden drone attributed to Russia by German officials, demonstrating new levels of hybrid warfare risks.

In response to these geopolitical challenges, Mr Tunkel emphasized that Germany and the UAE are well-positioned to collaborate on anti-drone technologies and air defence joint ventures to enhance regional security. He noted that the regional crisis heavily impacts the global economy, driving up inflation and energy costs in export-reliant nations like Germany that depend on open waterways and a rules-based international order. The UAE serves as a crucial pillar of stability in a troubled region, and Germany aims to support its efforts to project stability.

Bilateral economic cooperation spans multiple sectors, highlighted by long-standing joint ventures such as the partnership between Adnoc and Germany’s Linde, which has operated since 2007 to supply industrial gases. Renewable energy represents another major growth sector as Germany diversifies its energy imports following shifts away from Russian gas supplies. Sovereign wealth funds are viewed as vital financial partners for major energy transition projects, while both nations remain steadfast defenders of international law and freedom of navigation, pushing back against attempts to manipulate legal frameworks in regions like the Strait of Hormuz.