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Nazrin Abdul

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Relations between Azerbaijan and the United Arab Emirates have steadily evolved into a strong and forward-looking partnership grounded in mutual respect, trust, and shared values. What makes this relationship particularly notable is not only the depth of political dialogue, but also the way both countries are aligning their long-term national strategies in response to global economic and technological change.

As traditional oil-gas producing countries, Azerbaijan and the UAE share a similar economic history. Today, however, both are actively redefining their development models. While hydrocarbons remain an important pillar of their economies, Baku and Abu Dhabi are investing heavily in renewable energy, green technologies, artificial intelligence, and innovation-driven sectors. This shared transition from resource-based growth toward sustainable and knowledge-based economies has become one of the key drivers of closer bilateral cooperation.

The personal commitment and strategic vision of President Ilham Aliyev and President Sheikh Mohammed bin Zayed Al Nahyan have played a decisive role in elevating bilateral relations. Their regular high-level contacts have helped transform traditional friendly ties into a comprehensive strategic partnership. President Aliyev’s visit to Abu Dhabi on December 16–17 to attend the opening ceremony of the “Future Games 2025” was a symbolic reminder that the relationship is increasingly focused on the future, like technology, innovation, and youth engagement.

This political momentum was institutionalised with the signing of the Memorandum of Understanding on Strategic Partnership in January 2024, followed by the Joint Declaration on Comprehensive Strategic Partnership Relations in September 2025. These documents marked a new stage in bilateral ties, expanding cooperation across political, economic, energy, trade, and investment spheres. With more than 50 bilateral agreements signed to date, the partnership now rests on a solid and well-structured foundation.

Growing economic ties and investment cooperation - Economic relations between Azerbaijan and the UAE have shown clear and measurable growth. Trade turnover increased by more than 80 per cent in January–October 2025 compared to the same period of the previous year, reaching nearly $147.5 million. While there is still room for expansion, this sharp increase reflects rising business interest and improving connectivity between the two economies.

One of the most significant developments has been the establishment of the Joint Investment Fund in 2023 by the Azerbaijan Investment Holding and Abu Dhabi Development Holding Company. Rather than focusing on short-term returns, the fund is designed to support long-term, strategic investments. This approach was further strengthened by the signing of the Comprehensive Economic Partnership Agreement in July 2025 in Abu Dhabi, which aims to boost trade, diversify investment flows, and encourage cooperation in innovation and green technologies.

Energy cooperation in a time of transition - Energy remains at the heart of Azerbaijan–UAE cooperation, but the nature of this cooperation is changing. Both countries recognise the need to balance energy security with environmental responsibility. As a result, renewable energy projects have become a cornerstone of bilateral engagement.

The Garadagh Solar Power Plant, developed in cooperation with the UAE’s Masdar, marked an important milestone as Azerbaijan’s first large-scale solar project built with foreign investment. This was followed by the launch of even more ambitious projects, including the Bilasuvar and Neftchala solar power plants and the Absheron-Garadagh wind power plant. With a total planned capacity of 1,000 megawatts, these projects reflect Azerbaijan’s commitment to green energy and the UAE’s growing role as a global renewable energy investor.

At the same time, cooperation in traditional energy continues. ADNOC’s acquisition of a stake in a major Caspian gas field - Absheron, represents a rare example of truly reciprocal investment. This two-way model signals deep mutual confidence and marks a new phase of economic interdependence between the two countries.

Innovation, technology, and new opportunities - Beyond energy, Azerbaijan and the UAE are increasingly finding common ground in technology, digital transformation, and artificial intelligence. The UAE’s global ambitions in AI and smart governance align closely with Azerbaijan’s efforts to modernise its economy and develop advanced infrastructure. Cooperation in these emerging sectors opens new opportunities for joint ventures, startups, and knowledge exchange, further diversifying the economic partnership.

Shared values and an open business environment - Cultural and social similarities also contribute to the strength of bilateral relations. Both Azerbaijan and the UAE are Muslim-majority countries that place a strong emphasis on tolerance, multiculturalism, and coexistence. This inclusive approach not only shapes their domestic societies but also enhances their attractiveness as destinations for foreign investment and international business.

People-to-people contacts are expanding alongside economic ties. Direct flights between Baku and Abu Dhabi, Dubai, and Sharjah have boosted tourism and business travel. This year alone, nearly 39,000 UAE citizens visited Azerbaijan, further strengthening mutual understanding and economic interaction.

The Azerbaijan–UAE partnership is no longer defined solely by diplomatic goodwill or shared traditions. It is increasingly shaped by common responses to global challenges, from energy transition and climate change to technological transformation and economic diversification. By aligning their strategic priorities and investing in each other’s long-term development, Azerbaijan and the UAE are building a partnership that is pragmatic, forward-looking, and resilient.

In this sense, their relationship offers a compelling example of how energy-rich countries can successfully adapt to a changing global landscape, by working together, embracing innovation, and turning shared values into shared opportunities.