Following President Xi's visit to the UAE last week, the two countries have an opportunity to leverage their shared interests in emerging technologies

By Xische Editorial, July 25, 2018

President Xi arrived in Abu Dhabi last Thursday for a state visit—the first by a Chinese head of state in almost 30 years—designed to reinforce the already hefty economic and cultural ties between China and the UAE. However, his visit may have missed a broader opportunity to leverage the two countries’ shared interest in emerging technologies—namely artificial intelligence, blockchain, and ICT infrastructure. Unsurprisingly, energy investment and the ambitious Belt and Road Initiative (BRI) featured heavily during President Xi’s three-day trip. The flurry of announcements included a partnership and investment agreement in the world's largest solar energy project, two memorandums of understanding to enhance e-commerce ties and greater cooperation at the China International Import Expo, and several extensive energy agreements.

The UAE stands to profit from translating China’s ever-expanding trade interests in the region to those grounded in emerging technology. Indeed, the two countries already have a strong track record of collaboration on technology initiatives, including the YVOLV data centre, a project by Meeras and Alibaba, along with the MBR Solar Park, which is run by DEWA and the Silk Road Fund. Pairing Chinese talent with UAE test environments would support the development of everything from AI technology and blockchain to telecoms in both countries and accelerate global development.

AI systems are heavily dependent on data. China’s ability to harness the large volume of data emanating from its billion-plus citizens is one of its natural advantages in the field. The BRI’s trade networks across the emerging world present a valuable data proposition for China. Not only can Beijing expand its influence through the creation of analogue infrastructure such as bridges, tunnels, and railroads, but the country can also expand its technology footprint.

China is betting big on becoming a leader in high tech innovation. In July 2017, China announced a development plan to become the global leader in artificial intelligence, including a $2.1bn technology park in Beijing dedicated to AI research. With homegrown mega-companies such as Baidu and Tencent already leading the global AI race, China is well-positioned to achieve this goal. The UAE is a slightly different case. While the UAE announced its strategy for AI in October 2017, coupled with investment in AI projected to surpass $8bn by the end of 2017, the country is still in the process of developing or recruiting the right talent to deliver on the UAE’s AI goals. By leveraging Chinese technological expertise, the UAE can rapidly grow its AI expertise. Meanwhile, the Chinese will benefit from the optimal testing ground for AI solutions that the UAE provides with access to high-quality engagement points of over 200 nationalities that call the UAE home.

On ICT infrastructure, particularly high-speed and broadband internet, the UAE could - and should - step in. China has been successful in selling smartphones outside of the mainland with companies such as Transsion and Huawei dominating smartphone sales across African and Asian markets. Meanwhile, through telecoms companies such as Etisalat, the UAE has experience in several markets along the BRI.

The conditions are ripe for a UAE-China partnership on blockchain development, an area that certainly warrants further investigation. The UAE has an established track record on blockchain with the Dubai government taking the lead and pushing for blockchain to be used in the public sector. Likewise, China has expressed interest in using blockchain to improve governance.

Working together with Chinese researchers and companies, the UAE could build on its alliance with China to expand blockchain research around the world. As Xische’s strategy advisor, Mary Ames, recently argued in Gulf News, “Analysts predict that Chinese officials are setting the stage for a new blockchain strategy. If so, then China will soon join the UAE in shifting all applicable government transactions to local and federal blockchains. Given China’s influence on the blockchain industry, such a move is likely to have a profound impact on the trajectory of the evolving technology.”

Technological innovation requires the ability to quickly draw on the best talent from across the globe. The UAE has an opportunity to translate its strategic relationship with China on the BRI to an important partnership on emerging technologies like AI, blockchain, and ICT infrastructure. President Xi’s visit to the UAE is proof positive that both countries have much to gain from such a strategic bilateral relationship. Now is the time to take it to the next level.