January 23, 2026
4 mins read

UAE Shapes Future of Trade at Davos

At Davos 2026, the UAE showcases its growing leadership in shaping open, technology-driven global trade, positioning itself as a trusted bridge between economies in a fragmented world….reports Asian Lite News

The United Arab Emirates has used its presence at the World Economic Forum (WEF) 2026 in Davos to reinforce its growing role as a central player in shaping the future of global trade, highlighting a model built on openness, technology and strategic partnerships at a time of profound geopolitical and economic change.

During a high-level dialogue held as part of the WEF’s official programme, the UAE set out its vision for sustaining open and rules-based trade amid rising fragmentation, supply chain realignment and shifting centres of economic power. The session brought together Dr Thani bin Ahmed Al Zeyoudi, UAE Minister of Foreign Trade, and Simon Evenett, Professor of Geopolitics and Strategy at IMD, who explored how global trade leadership is evolving beyond traditional power blocs.

Dr Al Zeyoudi said the global economy is entering a phase in which leadership in trade will increasingly be defined by credibility, adaptability and cooperation rather than sheer economic size. He argued that as some traditional trade leaders become more inward-looking, the need for agile and reliable partners capable of sustaining open markets has never been greater.

“The UAE’s approach is grounded in building bridges between economies,” Al Zeyoudi said, outlining a strategy that prioritises partnership, flexibility and the modernisation of trade rules to reflect new realities such as digital commerce, supply chain resilience and sustainable growth.

He pointed to the UAE’s expanding network of Comprehensive Economic Partnership Agreements (CEPAs) as evidence of this approach in action. These agreements, now spanning key markets across Asia, Africa, the Middle East and Europe, have strengthened the country’s role as a trusted hub linking East and West, while providing businesses with greater market access and predictability.

A central theme of the discussion was the UAE’s Future of Investment and Trade Partnership, which Dr Al Zeyoudi described as a next-generation model for global economic cooperation. The initiative aims to facilitate investment flows, modernise trade frameworks and respond to emerging challenges such as technological disruption and geopolitical uncertainty. He said the partnership demonstrates how collaborative leadership can help preserve openness while adapting to a rapidly changing global environment.

Simon Evenett placed the UAE’s strategy in a broader geopolitical context, noting that the diffusion of economic power is creating opportunities for smaller and mid-sized economies to play a stabilising role in global trade. He said countries with open policies, strong institutions and diversified partnerships are increasingly well positioned to support continuity in international commerce.

Evenett cited the UAE as an example of how proactive trade diplomacy can help maintain momentum in global trade, even as uncertainty rises. He argued that leadership is no longer concentrated in a single capital, but shared among nations that demonstrate consistency and a long-term commitment to cooperation.

The Davos dialogue coincided with the launch of the third annual TradeTech Report, a flagship publication of the TradeTech Global Initiative, a partnership between the UAE, the World Economic Forum and the Abu Dhabi Department of Economic Development. Announced during Dr Al Zeyoudi’s keynote address to the “Recoding Trade” session, the report offers a detailed assessment of how advanced technology is reshaping global supply chains.

Titled “The TradeTech Paradox: Connectivity and Fragmentation”, the report introduces the concept of the TradeTech Stack, a framework that maps how technology connects different layers of the global trading system. These include international institutions that set foundational rules, national governments that regulate trade, logistics providers that enable movement, and businesses that produce and export goods and services.

The report highlights how technologies such as artificial intelligence and blockchain are already improving customs processes, logistics coordination and cross-border payments, making trade faster, safer and more predictable. At the same time, it warns that uneven adoption and regulatory fragmentation remain major obstacles, calling for closer collaboration between governments and the private sector.

Ahmed Jasim Al Zaabi, Chairman of the Abu Dhabi Department of Economic Development, said the TradeTech Initiative has played a key role in modernising global trade since its launch in 2023, describing trade as the lifeblood of economies and communities. He said Abu Dhabi’s position as a global supply chain node places it at the forefront of efforts to make trade more efficient and resilient.

WEF President and CEO Borge Brende said technology is becoming the connective infrastructure of modern trade, helping economies maintain continuity through greater coordination and confidence in cross-border processes.

Through its engagements in Davos, the UAE has positioned itself as a forward-looking partner committed to strengthening global trade governance at a time when the system faces mounting stress. By combining diplomacy, innovation and openness, the country is seeking not only to protect global commerce but to help reshape it for the demands of the 21st century.

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Pakistan Risks Overstretching Itself in Yemen War

Pakistan’s expanding military role in Saudi Arabia amid the Yemen conflict could strain its defence resources and fragile finances…reports Asian Lite News Desk Pakistan’s military involvement in the war in Yemen may prove unsustainable because of mounting financial pressures and competing security demands, according to a new report. Islamabad’s growing military presence in Saudi Arabia risks stretching its defence resources while exposing the country to greater strategic and economic challenges. An article by Andrew Wilson in One World Outlook describes Pakistan’s involvement as a case of “fiscal and strategic overreach”, arguing that the country lacks the financial flexibility to sustain an expanded military commitment. Pakistan’s external finances depend heavily on an International Monetary Fund (IMF) programme, financial support from Gulf countries and remittances from Pakistani workers in the region. The report argues that deeper military involvement in the conflict could place additional pressure on these sources of financial stability. It also warns that deploying troops and military equipment abroad could weaken Pakistan’s capacity to address security challenges along its eastern border and deal with two domestic insurgencies. The move could also draw Islamabad into a conflict it has sought to approach cautiously. A Reuters report in May, citing Pakistani security and government sources, said Islamabad had deployed around 8,000 troops, a squadron of approximately 16 aircraft, mostly JF-17 fighter jets, two drone squadrons and a Chinese HQ-9 air-defence battery to Saudi Arabia. According to those sources, Riyadh was financing the deployment, with Pakistani personnel operating the equipment. The sources also said a confidential agreement contemplated the possibility of deploying up to 80,000 troops. Islamabad has not confirmed those figures, although it has acknowledged its military presence in Saudi Arabia, including the deployment of fighter jets at King Abdulaziz Air Base from April. The One World Outlook article argues that Saudi financial support can cover allowances and operating expenses but cannot easily replace military equipment needed elsewhere or resolve the political and strategic challenges of participating in the Yemen conflict. Pakistan’s defence budget is another concern. For the 2026-27 financial year, the federal government allocated PKR 3 trillion, or approximately $10.8 billion, to defence services. The allocation represents an 18 per cent increase from the original PKR 2.55 trillion provision and amounts to around 2.1 per cent of projected gross domestic product (GDP). Defence spending accounts for approximately 16 per cent of the federal government’s PKR 18.8 trillion expenditure. Military pensions are budgeted separately at PKR 822 billion, while debt servicing costs stand at approximately PKR 8 trillion, more than two-and-a-half times the defence allocation. The report argues that these competing financial obligations leave little room for additional military expenditure without placing further pressure on public finances. Pakistan’s reliance on IMF assistance also limits its fiscal flexibility. The country must meet the conditions attached to the programme, including a primary budget surplus target of 2 per cent of GDP and continued restraint on development spending. According to the article, these requirements make it difficult for Islamabad to finance an additional military commitment without compromising other budgetary priorities. Pakistan’s economic indicators offer limited reassurance. Economic growth for the 2025-26 financial year is estimated at between 3.6 and 3.7 per cent, while inflation reached approximately 10.3 per cent in September following an energy price shock. Foreign exchange reserves stood at around $21.5 billion at the end of September. Although this marks an improvement from the low levels recorded in 2023, the report notes that the reserves cover only a few months of imports. Financial assistance from Gulf partners remains central to Pakistan’s external stability. The article says Islamabad holds approximately $8 billion in Saudi deposits at its central bank. In July, the State Bank of Pakistan said Riyadh had extended the maturity of $5 billion in deposits to December 2028, easing the country’s immediate external financing requirements. A further $3 billion deposit was also extended in the spring. However, the article argues that these arrangements provide temporary relief rather than long-term financial independence, particularly as regional conflict threatens the stability of the Gulf economies on which Pakistan relies. The report concludes that Pakistan faces a difficult balance between supporting Saudi Arabia militarily and preserving the financial and military resources needed to address its domestic and regional challenges.
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