By Steve Moore
The event is called The UAE and the widening Gulf conflict — what happens next? The panel includes Sir Oliver Dowden MP, who chairs the UK-UAE All-Party Parliamentary Group; Dr Burcu Ozcelik of the Royal United Services Institute; and James Swanston, who covers the region’s economies for Barclays. David Waddell of the BBC will chair.
Emirates Wire was set up for exactly this: to give readers in the UK a serious, independent read of the UAE that covers the ambition and the costs together, and to bring the people worth listening to into one room now and again.
The easy story about the United Arab Emirates is the one told in the atrium of a Dubai hotel: a young federation, born in 1971, that turned oil into a skyline, and a skyline into a brand. That story is true as far as it goes, and it stops roughly where the interesting country begins. Fifty-four years is not long for a state to have gone from Bedouin coast to sovereign-wealth actor with a view on everything from AI standards to global gold flows. Most states of that age are still working out their capital city. The UAE is a middle power with the balance sheet of a state twice its size, the diplomatic reach of a country five times its population, a citizen body that is a small minority within its own borders, and a neighbourhood in which two of the sea lanes it depends on are being fought over by parties it cannot fully control. Any one of those would make a decent essay. The four together are the country.
Start with the economy, because it is where most of the confidence comes from. In 2025, the UAE grew by 6.2 per cent, to Dh1.9 trillion, or roughly $517 billion, according to the Federal Competitiveness and Statistics Centre. Non-oil GDP grew by 6.8 per cent. Non-oil now accounts for over three-quarters of national output. Trade, finance and construction each contribute more than manufacturing. Real estate grew by nearly eight per cent. At first pass, those figures look like a miracle. Sit with them and something more disciplined shows through: a state that decided some time ago to spend petroleum revenue on becoming a place where oil would matter less. That policy is now in year twenty-something, and the compound effect is visible in the shape of the pie chart as much as in the size of it.
The plumbing sits behind this. The Comprehensive Economic Partnership Agreement programme, launched in September 2021 to widen non-oil trade, has produced 37 concluded CEPAs, 18 of which are in force, according to Trade Minister Dr Thani Al Zeyoudi. Another 20 are under negotiation. Canada is close; the EU has reached its seventh round. What matters here is not the number, which any government can produce, but the pattern: the UAE is signing bilaterals with the kind of second-tier partners, from India and Turkey to Georgia, Cambodia and Colombia, that a British government would not have bothered to court a decade ago, and it is doing so in parallel with its inclusion in the UK’s own Gulf-wide trade agreement. That agreement, announced on 20 May 2026, the Department for Business and Trade bills as the first comprehensive FTA between a G7 country and the GCC. It is a treaty London wanted, and the UAE largely designed the case for.
The bilateral relationship with the UK is, in the good sense, quiet. Total trade in the four quarters to Q1 2026 stood at £25.2 billion, according to ONS figures published by DBT, almost exactly half of which is services. The UAE is the UK’s twentieth-largest trading partner, which sounds unimpressive until you notice that no other country of nine million people appears anywhere near that list. Compared with £17.5 billion in 2016, the ten-year change is 43 per cent, which is real growth. It is not a doubling, but it has quietly outperformed the UK’s average.
Under those trade figures sits Abu Dhabi Global Market, which has begun to look less like a financial free zone and more like the region’s version of Zurich. In the first quarter of 2026, ADGM reported assets under management up 57 per cent year on year, 179 asset and fund managers, and 263 funds under management. Firms announcing their move to ADGM this year already represent over $4.4 trillion in global AUM. Its older sibling, the Dubai International Financial Centre, now hosts 27 of the world’s 29 systemically important banks. Together, the two centres have made the UAE a place where large amounts of the world’s money are managed by people who do not live there, under a common-law regime most of the world’s money is comfortable with. This is a competitive answer to a question the region has been asked for a generation, and the answer appears to be working.
The technology story runs alongside it. In 2024, Microsoft made a $15.2 billion AI investment in the UAE through G42, Abu Dhabi’s national champion. G42’s sovereign agentic AI arm says it intends for AI agents to support fifty per cent of federal government operations within two years, and to train 80,000 workers to use them. Whether that target is met is less important than the direction of travel: the UAE has decided to produce AI as well as buy it, working with the American stack while keeping the underlying data inside the country. Any policymaker in London who is watching sovereign AI capability as a strategic question can learn from that architecture, and probably should.
None of this cancels the harder questions.
Begin with the diplomatic terrain, because it has changed twice in five years. The Abraham Accords of 2020 gave the UAE what was in effect a peace agreement with Israel, and a route into a set of technology and trade partnerships that Emirati economic planners had been circling for the better part of a decade. Bilateral trade with Israel was set to reach $10 billion by 2027, up from $2.5 billion in 2022, according to research from the Carnegie Endowment. After 7 October 2023, the UAE publicly condemned Israeli conduct in Gaza. It did not sever relations. Government-backed entities on both sides kept working, though at reduced tempo. The joint gas project with ADNOC and BP shows that the connective tissue has not been cut. What has changed decisively is the political weather, and any Emirati diplomat now speaks to an Arab public that has watched two years of televised loss and remembers who was in the room when the accords were signed. Managing that gap is now the daily work of Emirati foreign policy, and it is harder than the trade lines suggest.
Iran is the second axis. For years the UAE managed this by engaging economically with Tehran while hedging militarily and diplomatically through Washington, and, since 2020, by building working understandings with Israel that a widening regional confrontation now tests. The phrase widening Gulf conflict on the invitation reflects a Yemen-Red Sea theatre in which Houthi missile and drone activity continues to distort shipping, a Levant in which the Gaza conflict has spilt into Lebanon and Syria, and a Gulf littoral in which insurance markets have already priced in the risk. The panel will bring three lenses to what has followed. Burcu Ozcelik will read the strategic map, James Swanston the macroeconomic damage, and Oliver Dowden the UK policy questions that flow from both. None of them, on the evidence so far, will pretend it is settled.
The strategic doctrine written for the previous decade did not budget for having the Iranian problem delivered to the front door. Since 28 February 2026, that picture has been an active regional confrontation. On the night the United States and Israel launched their coordinated strikes on Iranian nuclear, military and command sites, Iran retaliated across the Arabian Peninsula, and UAE territory was among the targets. Iranian missiles and drones have struck Emirati soil more than once since then; the UAE has intercepted several waves, and on 4 May 2026 an oil facility at Fujairah was hit and set alight. In July, Iranian action against ADNOC-affiliated tankers in the Strait of Hormuz killed one crew member and wounded eight. Further Iranian strikes on Emirati-linked vessels followed in August. On 19 August, after the UAE detected two ballistic missiles launched from Iran towards its territorial waters, Abu Dhabi suspended trade with Tehran. Traffic through the Strait of Hormuz, one of the two sea lanes on which the UAE economy is built, has run at a small fraction of its pre-conflict rate for most of the period since, with roughly ten commodity-vessel transits a day at recent count against a normal figure of around one hundred. The ceasefire declared in the spring did not hold. A country whose entire modern economic story assumes an open Gulf is now living with the reverse. That is the situation the panel is being asked to talk about, and it is why the phrase widening Gulf conflict is doing serious work on the invitation.
The insurance market has been keeping a scoreboard on all of this. The UAE has sat on the Joint War Committee’s list of areas where vessels face heightened risk of hull war, piracy, terrorism and related perils since 17 May 2019, when the JWC added Oman, the UAE and the wider Arabian Gulf to its listed areas eight days after the tanker attacks off Fujairah. It has not come off. On 3 March 2026, the committee went further, adding Bahrain, Djibouti, Kuwait, Oman and Qatar to the same list as tensions rose around Iran, so that essentially every waterway a UAE-bound cargo has to cross is now designated. Lloyd’s List reports that in the current market, US, UK and Israeli-flagged ships are being charged roughly three times what other flags pay for cover in the region. Additional war risk premium for Red Sea transits rose from around 0.3 per cent of hull value in the first half of 2025 to about 0.7 per cent by July 2025, and by July 2026 Reuters reports southern Red Sea rates over 1 per cent; Persian Gulf rates have moved with them. Fujairah itself remains one of the cheaper points on the map, but the fact that Lloyd’s underwriters are pricing every vessel that calls at an Emirati port on the assumption of elevated war risk is not a small thing. It is the market’s view of the widening conflict, priced daily, and it is the view the UAE has to plan against.
The third axis is one many UK audiences underestimate: the Horn of Africa. The UAE is now the world’s second-largest gold-trading hub after London, with $186 billion in gold passing through it in 2024, of which around one per cent came from Sudan. That single line contains a controversy. Chatham House reports that almost 97 per cent of official Sudanese gold exports from army-held territory in 2024 went to the UAE, worth $1.52 billion; that the UAE is the dominant destination for Sudanese gold, and that Sudan has filed proceedings at the International Court of Justice accusing the UAE of complicity in genocide through its support for the Rapid Support Forces. The UAE denies backing the RSF. In August 2025, it also ceased commercial flights and shipping between its ports and Sudan, a step that Reuters reports drove the Sudanese pound down nearly 40 per cent. The UAE Ministry of Foreign Affairs values Emirati humanitarian support in Sudan at $4.24 billion. This is a live and unresolved argument, and the UK has views on it. It is one reason a room in London is a good place to discuss what happens next.
Beneath all of this sits the citizen question, which Emirati leaders speak about most among themselves. UAE nationals are, on any reasonable estimate, well under fifteen per cent of the country’s population. The Nafis programme, launched in 2021, was designed to raise the share of Emiratis in private-sector skilled jobs to ten per cent by the end of 2026. That target was at eight per cent by the end of 2025, with 176,000 UAE citizens now working in private firms, 152,000 of whom joined after Nafis began. In April 2026, Sheikh Mansour bin Zayed extended the strategy to 2040. In parallel, the government has begun reducing the salary top-ups that funded the early phase and reframing the programme as a performance culture rather than a subsidy. The Nafis Secretary-General has said the shift is away from recruitment targets and towards Emiratis holding influence, not headcount, in the private sector. Whether that transition works will decide whether the next generation of UAE nationals feels the country was built for them.
The golden visa sits on the other side of the same equation. Since 2019, the UAE has issued hundreds of thousands of ten-year visas to investors, exceptional professionals, retirees, students and entrepreneurs, with the property threshold now set at Dh2 million and off-plan investments included. The system explicitly courts the world’s mobile talent. It raises a philosophical question the UAE has not yet been asked to answer in public: what does citizenship look like when residency is stable, welcoming, and long-term for millions of people who will never hold a passport? The UAE will not be the only country that has to think about that in the 2030s, but it is the country furthest along the road.
The centennial plan, launched in 2017 by Sheikh Mohammed bin Rashid, sets 2071 as the year in which the UAE would like to be, in his words, the best country in the world. What that means is contested even inside the government, which is arguably part of the point. The plan gives ministers a horizon that is longer than any single presidency, and it gives Emirati citizens a story in which the country’s next fifty years are the interesting ones.
The challenges to meet against that horizon are practical and physical. Water is the closest to home: nearly 42 per cent of national water demand is met through desalination, an energy-heavy process that carries significant emissions costs, and one on which the UAE will have to keep innovating if the population grows the way its planners expect. Food security is next, which is why NRTC’s acquisition of 10,000 feddans in Egypt matters strategically as well as commercially. The climate transition matters both because the UAE hosted COP28 and because its own summer will require it. Succession, though rarely discussed in public, is now formal: Sheikh Khaled bin Mohamed was named Crown Prince of Abu Dhabi in 2023, and the deep bench of Emirati technocrats around him is, by regional standards, unusually settled.
Read against that horizon, the UAE’s strengths are real. It plans on fifty-year timelines and updates the plan each year. Its financial architecture has become genuinely regional and, increasingly, global. Its diplomacy keeps as many doors open as it can for as long as it can. The pressures on that model map roughly onto the panel. The neighbourhood is one: a Gulf where the American security guarantee is less absolute than it was, and where every Emirati calculation now has an Iran, an Israel and a Yemen entry. The balance sheet is another: a non-oil economy that has to keep outperforming an oil economy whose prices may not cooperate. And the citizen is the third: the country has to give its own people a private-sector future without pricing out the talent that made the country attractive in the first place.
The piece is background, not conclusion. The genuinely hard question is one great powers, on their form to date, do not know how to answer: how do you plan for fifty years from a country that has to plan for fifty days? On 9 September I hope Oliver Dowden, Burcu Ozcelik and James Swanston, in David Waddell’s hands, will take the argument further than I can here. The invitation is at events.emirateswire.co.uk. It is free and on the record: drinks at 6:00 pm, discussion at 7:00 pm, at the National Liberal Club. Come if you can. There are questions in the paragraphs above that I don’t think are being asked seriously enough in London, and I would rather ask them in a room than in a footnote.