Introduction
The Middle East is currently one of the growing economies in the world. The growth has led to expansion in its market share and trading regions. Some of the regions that have attracted the interest of the UAE include Latin America. With its wealth of minerals and arable land, the region has attracted the interest of several countries in the Middle East. Due to the interest, some leaders have become guests of the region and most of them have signed various accords and memorandums. Although China is a dominant trading partner in Latin America, the entry of the UAE may challenge its dominance.
Some of the countries targeted by the UAE include Brazil, Peru, Mexico, Uruguay, Cuba, and Argentina. Besides the other Latin American countries, the interest of the UAE has been on specific countries, which comprise Brazil and Argentina. It is within this backdrop that the report provides an analysis of the political and trading relationship of the UAE and Latin American countries such as Argentina.
UAE and Latin America
Entry and Interest
The growing interest between the UAE and Latin America has been due to several reasons. Some of the reasons that sparked the interest and entry into the region include the availability of minerals, a good political environment, and permissive trading conditions for foreigners in the region. It is important to explain that Latin America is a region blessed with several minerals seriously needed by their counterparts in the UAE.
Minerals such as gold, copper, and iron are some of the raw materials required by several countries in the Middle East. A research done by the Geological Survey explains that the Latin American region is the largest producer of minerals consumed by the countries in the UAE (42). The explanation by the Geological Survey is practical in substantiating the fact that the UAE needs Latin America more than ever. Fundamentally, the cooperation between the UAE and Latin America has been going on for ages and experts expect that the peaceful trade and political relationship will continue.
Another factor that compelled the UAE to begin its cooperation and trade with the Latin American region is the need for food. Notably, because large parts of the UAE are arid and cannot provide adequate amounts of food for its inhabitants, it implies that the region has to venture into other areas that have arable land, which produces food. The Latin American region has become an alternative source of food and land for the UAE, which is even starting to purchase some pieces of land from countries like Brazil and Argentina.
The recent development in Argentina where they announced that land would be available for foreigners from countries of the UAE was one the greatest strides that compounded the thriving relationship between the regions (Clement 195). Apparently, the UAE has been importing food from the region but it now wants land so that it can minimize its importation cost. As a result, large pieces of land are currently under the development plan of the UAE companies.
Political Relationship
Remarkably, the political relationship between Latin America and the UAE has risen from early 2000. Leaders from the regions have held several meetings, which lead to agreements and accords that foster trade and good relationships. Also, the two regions have been visiting to create a robust and thriving business and political relationship between the regions. The agreements and memorandums are usually an outcome of a series of talks held by the regions.
Furthermore, the good political relationship between the regions is an outcome of their mutual requirements (International Business Publications 205). While the UAE needs raw materials or minerals and food from Latin America, Latin Americans require the support of the UAE so that they can improve the state of industrialization. Oil, gas, and other sources of energy are in high demand in the Latin American regions.
Therefore, by being a leading exporter of oil, the UAE caught the interest of several countries in Latin America. According to Clement, Argentina is one of the leading importers of oil in Latin America (225). The need for oil as a source of energy is one of the factors that catalyzed the good political relations between the UAE and the Latin America in general. It is crucial to state that the good political grounds have enabled several companies from the UAE to register themselves in Securities and Exchange Commission organizations in various countries of Latin America, a factor that will ease trade between the regions. Another element that is a result of good political ties is the introduction of direct flights. A good example is the introduction of direct flights from Dubai to Buenos Aires and Sao Paulo. The flights not only catapult trade between the UAE and Latin America but also demonstrate a good political will from the regions.
Trading Environment
Principally, trade between the UAE and Latin America concerns minerals, food, and finished products. While Latin American countries need finished products from the UAE regions, they supply food and minerals to the Middle East. Masdar Times states that the visit from Sheikh Abdullah bin Zayed for trade talks was among the instrumental steps that substantiate the interest that the UAE and Latin America have towards trade (10).
The meetings that have been going on for several years focus on increasing trade between the regions. Leaders from the respective regions have been visiting various countries in an attempt to foster economic ties and trade. The agreement to have companies from the UAE is a result of meetings and agreements that the leaders signed after the talks with the intent of fostering the economic development and trade among the regions.
By visiting the region, the leaders of the UAE compound the essence of trade between the Middle East and Latin America. From the visit, it is clear that the region of Latin America has attracted the growing economies and indeed, the intent to supersede the investments and trade that China has in the region. Evidently, the leaders from countries such as Brazil and Argentina have been championing the purchase of their products, which include fish, poultry meat, and minerals by countries in the Middle East. On the other hand, the leaders of the Middle East are advocating for a swift and cost-effective trade from the Latin American region (SELA 49). Among the requirements that the leaders of the UAE region advance include minimization of tax on goods imported from Latin America and relaxation of laws so that investors from the UAE regions can undertake their operations peacefully without interferences from the state.
UAE and Argentina
Political relationship
Notably, the good political relationship between Argentina and the UAE began in the 1970s and continues to progress. The progress peaked in 2008 when the two countries started developing lasting relationships and build embassies. As a result, Argentina and the UAE have held progressive talks to strengthen the ties with leaders from Argentina traveling to Dubai and envoys sent from the Middle East. The good relationship between the countries has led to developments in Argentina.
The funding and loans received from the Middle East has seen the country improve its irrigation schemes, infrastructure, and the energy sector. According to Mustafa, Cristina Fernandez, the president of Argentina, visited Dubai where she had talks with the leaders of the UAE (5). The visit was one of the numerous visits made by the leaders of the two countries in their quest to improve their political relationships.
Although the Middle East has eyes on the Latin American region, the focus on Argentina is one of a kind. The focus on the country is because of the relaxed laws on trade and political affiliations that are in harmony with the views of regions such as the UAE. The recent visit by his Highness Sheikh Khalifa bin Zayed was a landmark visit that demonstrated the level of relationship between the country and the Middle East (Frayssinet 2).
The framework of current politics in Argentina is one that is liberal and more relaxed implying that investors from places such as the UAE can invest in the country effectively. During the visit, his highness and the president of Argentina had discussions on the various ways that can be useful in boosting the overall development of the two countries. While Argentina focused on increased market and minimal taxation for imports from the Middle East, his highness reiterated the issue of taxation on farm produce and minerals.
Trade Relationship with the UAE
Apparently, the UAE is a dominant trading partner in Argentina. The partnership has seen several agreements signed in an attempt to minimize trade barriers and develop a framework, which facilitates easy trade between the two regions. The agreement signed by the leaders of Argentina and the UAE in 2013 was one of the several accords that aim to foster trade between the two partners. The leaders, who signed the accord, were Ricardo Daniel, who heads the Argentina’s Federal Administration of Public Revenue, and Mr. Khalid Ali Al Bustani, who is the Federal Customs Authority Acting Director (Echandi and Sauvé 241).
The agreements focused on the removal of barriers between the countries and relaxing stringent trade laws that limited business among the countries. Exchange of information concerning shipment policies, procedures, monitoring, and other custom requirements would be available for both the Argentineans and investors from the UAE.
The move aimed at increasing the level of investment in Argentina as well as in the UAE. It is important to note that Argentina and the UAE have products that they import or export from one another. While Argentina imports products such as electronics and used automobiles from the UAE, the Middle East imports food and minerals from Argentina. Therefore, fostering trade between the two regions would lead to their overall development. Infrastructural developments, acquisition of alternative sources of energy, and improved types of irrigations are some of the developments that Argentina would enjoy in the advent of a good trade with the UAE. On the other hand, the UAE would enjoy minimal restrictions and ease in importing food and minerals as well as investing in the country.
Exports
Argentina is one of the leading trading ports in the Latin American region. The country has several minerals and food crops all of which boost its ability to export the said products to parts such as the UAE. Smil, explains that some of the products that the country exports include cereals, beef, poultry meat, fish, and soybeans (55). The ability to produce and export food products across various parts of the world has placed the country in a better position and a good market for countries in the Middle East.
From the early 1900s, the Middle East has engaged in trade with Argentina and the relationship went a notch higher when the leaders signed a memorandum of understanding and agreements that ease trade between the two regions. One such agreement was signed in 2012 and concerns the supply of beef to Dubai which is one of the leading importers of food from Argentina. With the signing of various agreements, it is lucid that trade between Argentina and the UAE is bound to advance and challenge the Asian dominance.
Imports
Notably, the country has several products that it imports from other countries, which include those in the Middle East. Some of the imports include plastics, used automobiles, glass, ceramics, steel, iron, and electronics. Kirk elucidates that the UAE region can facilitate the export of electronic equipments produced in Asia, as they comprise the imports that the country requires (15). It is paramount to assert that some of these products are finished or semi-finished. Besides importing products from regions such as the UAE, Argentina has also lobbied for tourists and the supply of alternative sources of energy. The lobbying for alternative sources of energy bore fruits during the recent visit from his highness where Argentina got the privilege and opportunity to use nuclear energy. By lobbying for tourists from the UAE, Argentina tries to ensure a maximum utility of its hotels, and in turn, reap the revenues earned by its service providers.
Conclusion
While the Asian continent was among the first continents, which traded with countries in Latin America, the invasion of the United Arab Emirates in the region is worth recognition. The UAE developed an interest in the Latin American region because of the abundant minerals and food. Since a large part of the UAE is arid and semi-arid, the development of a good business and political relationship was core to achieve the much-required products provided by countries such as Argentina.
The arable land, which is vast in Latin America, is one of the major sources of interest that led to the entrance of the UAE. While the UAE exports its products such as used automobiles to the Latin American countries, the Latin Americans export food and minerals. One of the countries that have witnessed the benefits of trade from the UAE is Argentina. The country has acquired loans and investments that have helped in the development of infrastructure and other sectors of the state. In exchange for the services and loans rendered by the UAE, the Argentinean government relaxed some of its laws and permitted investors from the UAE to invest and develop their companies in the country.
Works Cited
Clement, Christopher. “The Ever-Changing Energy Sector; We Live In Revolutionary Times.” International Energy Law Review 32.6 (2014): 193-228. Print.
Echandi, Roberto, and Pierre Sauvé. Prospects in International Investment Law and Policy: World Trade Forum, Cambridge: Cambridge University Press, 2013. Print.
Frayssinet, Fabiana. United Arab Emirates Strengthens Ties with Argentina’s New Government, New York: Inter Press Service, 2016. Print.
Geological Survey. Minerals Yearbook – Area Reports: International Review: 2011, Latin America and Canada, Geological Survey: London, 2013. Print.
International Business Publications. South American Countries Mineral Industry Handbook: Strategic Information and Regulations, Intl Business Pubs: New York, 2015. Print.
Kirk, Ron. National Trade Estimate Report on Foreign Trade Barriers, New York: DIANE Publishing, 2011. Print.
Masdar Times. “The Masdar Times.” Journal of trade and renewable energy 1.13 (2014): 1-12.Print.
Muastafa, Awad. UAE signs nuclear cooperation deal with Argentina, London: The National, 2016. Print.
SELA. Relations between Latin America and the Caribbean and the Middle East: Status and areas of opportunity, Caracas: Permanent Secretariat of SELA, 2012. Print.
Smil, Vaclav. Should We Eat Meat?: Evolution and Consequences of Modern Carnivory, New York: Wiley, 2013. Print.