The invasion of Russia into Ukraine was the final turning point for the German government to diversify its energy policy. Beside one of the most important topics of the 21st century, the climate change, the political leadership of the fourth biggest economy in the world made the challenge of leaving the fossile age to one of its top priorities.
Germany aims to achieve climate neutrality by 2045, and with its declared goal of achieving this, countries like the United Arab Emirates (UAE) together with other Gulf States might become a partner for the European economy. Robert Habeck (Greens), Vice Chancellor and responsible Minister for Economy and Climate seems to be convinced that cooperation with the Gulf region can contribute to achieving climate goals and increasing ambitions. The UAE is seen as having significant potential for renewable energy and excellent conditions for exporting large quantities of green hydrogen.
In light of the developments in the wind energy sector in Germany, the Emirati company “Masdar” and the Spanish company “Iberdrola” decided to invest in the development of a 476-megawatt wind farm in the Baltic Sea in Germany. According to sources from the UAE, the two leading companies in the clean energy sector signed a strategic agreement for the investment in the “Eagle Baltic Sea” wind farm. The project is expected to enter initial operation in late 2024, with a minimum approved tariff of 64.6 euros (71.54 dollars) per megawatt-hour for the first 20 years.
Cooperation and prospects of the project
Clean energy and and a sustainable environment is one of the top priotities of for the current German government, especially since Germany is the largest economy in Europe. This places it at the forefront of European countries in terms of environmentally harmful emissions, which drives it to work harder to achieve carbon neutrality. In contrast, the UAE was the first country in the MENA region to announce its goal of achieving climate neutrality..
Siemens Energy and the Dubai Electricity and Water Authority (DEWA) opened the first green hydrogen pilot project in the Middle East and North Africa (MENA) region in Dubai in May 2022. Plans are underway for other green hydrogen and synthetic fuel projects. Siemens Energy was founded in 1999 as a local company and has had a new headquarters in Masdar City in the Middle East since 2014. Together with the government of Abu Dhabi, state institutions, and companies, Siemens Energy leads the development of innovative new industries and opportunities, such as hydrogen and sustainable aviation fuels.
The two countries have several agreements related to clean energy, and many joint programs have been implemented. The governments of the UAE and Germany discussed launching an extensive action program aimed at strengthening the partnership in three pillars related to future energy. These pillars include increasing renewable energy production, improving its efficiency and demand management, as well as enabling higher green energy storage. It also involves fuels for the aviation and maritime sectors, along with an ambitious partnership in various forms of the energy sector, as part of the “Declaration of Intent” for cooperation signed by the two countries back in 2017.
Starting in February 2022, the UAE and the German state of Bavaria signed a joint declaration of intent to cooperate in efforts to address climate change and protect the environment during a delegation’s visit to the UAE.
In coordination with the Emirati-German partnership in the energy sector that began in 2017, both sides will seek to engage public, private, and academic sectors in exploring prospects for cooperation in areas such as climate neutrality, waste management, circular economy, air pollution control, food waste management, wastewater treatment, groundwater technologies, and green hydrogen.
Peace and stability in the Middle East
The German government is seeking for new peace solutions in the Middle East. Shortly after taking office, the German Foreign Minister Annalena Baerbock (Greens) made a tour that included Israel, Egypt, and Jordan. She announced her intention to give a fresh impetus to the Middle East peace process, which has remained stagnant for years. “Even if the conflict in the Middle East has been a long-standing issue for many, we cannot accept it as the current situation. The peace process between Israel and the Palestinians has largely stalled since 2014.”
Germany’s vision for peace seems to align with the UAE, which seeks to explore and enhance peace opportunities through dialogue and finding common ground for cooperation. Climate protection was also a major concern for Baerbock during her trip to the Middle East. To address this concern, she wants to explore new forms of cooperation with regional countries due to concerns about rising temperatures and increased water scarcity. Baerbock stated: “Establishing diplomatic relations with Arab countries opens up new and vast opportunities for the climate and energy sector.” Energy and climate issues can ensure stronger cooperation and good neighborly relations, referring to the peace agreements signed in 2020 between Israel and Arab countries, including the United Arab Emirates and Bahrain.
The current German government believes that in the 21st century, climate policy is also geopolitics and should therefore be an integral part of German foreign policy. This convergence of views between Berlin and Abu Dhabi opens up broad areas for cooperation to advance Israeli-Palestinian peace negotiations, which would have a positive impact on the region as a whole and lead to joint projects between regional countries to build stronger bonds among the people.
When Chancellor Angela Merkel retired, she left her successor, the Social Democrat Chancellor Olaf Scholz, with a heavy burden of challenging issues to address. Among these the Libyan crisis, which the new German government is committed to stabilizing within the framework of the United Nations’ plan and the Berlin Process.
Over the past ten years, the Libyan crisis has posed a difficult test for coordination among European countries, revealing significant divergences in their responses. It has also had a negative impact on European-Maghreb relations. According to officials in Abu Dhabi, the UAE played an essential role in the Berlin Process.
The first Berlin Conference back in 2020 – still under former Chancellor Merkel -, discussed the Libyan transitional process and included participation from key figures such as General Khalifa Haftar and Prime Minister of the Government of National Accord Fayez al-Sarraj, as well as several international organizations together with eleven countries, including the UAE. Among the key points agreed upon were: no military solution to the conflict, respect for the arms embargo imposed by the United Nations on Libya since 2011, and a commitment by the concerned countries to respect the embargo and not interfere in Libya’s internal affairs, aiming to restore peace.
The “Berlin 2” conference on Libya, concluded in 2021, confirmed the commitment to holding elections on the scheduled date of December 24. It also called for the immediate withdrawal of foreign mercenaries from Libya, the coordinated and balanced withdrawal of foreign forces, and an expedited resolution to armed groups and militias, including disarmament. Moreover, it called for imposing UN sanctions against violators of the arms embargo or the ceasefire and the establishment of a unified Libyan security and defense force under civilian authority.
These goals provide a basis for a shared vision between the UAE and Germany, which focus on assisting Libya in achieving a peaceful political solution. This is especially relevant given the recent developments in the relationship between Turkey and the United Arab Emirates, both key players in the Libyan crisis. It was one goal that both parties, coupled with Germany’s commitment to the Berlin Process, could contribute to positive outcomes, especially after the postponement of Libyan elections and renewed tensions among stakeholders.
Economic and Trade Relations
Both countries continuously seek to promote investment and explore possible investment opportunities. The UAE opened the Abu Dhabi Investment Office (ADIO) in Germany in 2021. One year later, the office launched its first virtual event for German business leaders, executives, and entrepreneurs, where opportunities for expansion in the UAE’s capital Abu Dhabi were presented. “Through ADIO’s Frankfurt office, we enhance our support for German companies and provide quick access to numerous opportunities in the Middle East, adding, I invite all German business leaders to consider Abu Dhabi for their future expansion”, Mohammed Ali Al Shorafa, Chairman of the Department of Economic Development in Abu Dhabi, stated.
For Germany, the UAE is considered the largest trading partner in the region. In 2020, the volume of bilateral trade reached 7.51 billion euros. The partnership is set to become more profitable considering the strong mutual interest in further cooperation in areas such as renewable energy, smart manufacturing, digitization, and other innovation-driven sectors. The Emirates topped the list of German goods importers among Arab countries (4761.95 million euros) during the period from January to September 2021, according to the latest report by the Arab-German Chamber of Commerce and Industry.
The German Foreign Minister shows a significant interest in the Middle East. However, her approach, as demonstrated by her visits to Egypt and Jordan, has taken a more realistic turn than expected. The Green Party tends ideologically to take stricter stances on human rights and democracy issues. The Foreign Minister faced criticism in the German media for not focusing on these issues during her talks with Middle Eastern leaders. This is likely due to the importance of coordinating with the region’s countries without arousing sensitivities among their leaders. Egypt plays a major role in the Libyan crisis and the Israeli-Palestinian peace process, while Jordan has been a key Western partner for many years and wields significant influence in Palestine and Syria. This pragmatic approach to relations with these countries serves the continuity and cooperation between Germany and the Gulf region, including the United Arab Emirates, to achieve common interests.
The clean energy sector is considered one of the most important areas for cooperation between Abu Dhabi and Berlin. Germany possesses the necessary competencies, scientific expertise, and manufacturing capabilities in clean energy, while the UAE has the investment capabilities, political and financial interest to recognize the importance of these projects and the capacity to lead them in many Middle Eastern and African countries.