Donald Trump’s victory in the 2024 US elections has significant implications for the UAE, particularly in areas like defence, trade, and economic cooperation. With a focus on transactional alliances, Trump’s policies are expected to strengthen the UAE’s position as a global hub for technology, energy, and defence.
Economic and Trade Policies
Trump’s approach to tariffs and job protection has gained traction among voters, and this could extend to US-UAE trade relations. Analysts predict that his “America First” policies will support economic growth in the UAE, particularly in defence and technology, sectors that are vital for the nation’s strategic goals.
Market Reactions in the UAE
The UAE dirham has strengthened following Trump’s victory, with many currencies weakening against the dollar. Analysts predict that the dirham will continue to benefit from Trump’s policies, particularly if the US dollar remains strong. Additionally, UAE stock markets have shown positive responses, in line with US equities, as investors anticipate continued economic cooperation between the two nations.
Regional Stability and Foreign Policy
Trump’s past policies on the Middle East, especially regarding Iran and regional alliances, have brought stability to the UAE. His “maximum pressure” approach on Iran is likely to continue, and his administration’s strategic focus on defence and technology is expected to align with the UAE’s goals of innovation and security.
Impact on UAE’s Defence, Energy, and Technology Sectors
Trump’s foreign policy aims to foster closer partnerships with key allies, which could lead to increased US investment in sectors important to the UAE, including defence, energy, and technology. This aligns well with the UAE’s long-term ambitions of becoming a global leader in these areas, boosting regional stability and economic growth.
The UAE’s Economic Diversification Amid Global Uncertainty
Despite potential global trade challenges, the UAE is expected to remain resilient due to its diversified economy and business-friendly environment. Trump’s policies, particularly regarding the US dollar and interest rates, could strengthen the UAE’s financial sector and encourage continued growth in the region.
Conclusion: Optimism Amid Caution
While there are positive expectations regarding the UAE’s future under Trump’s presidency, experts advise caution. Global conditions are shifting, and investors should wait for concrete policy directions before making significant moves. However, Trump’s previous term demonstrated favourable engagement with the Gulf, and his victory is likely to bring renewed opportunities for the UAE.
