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Strategically located at the crossroads of Asia, Africa and Europe, the Gulf has historically facilitated international trade as a highway between East and West. It is also central to planned intercontinental trade corridors such as the India-Middle East-Europe Economic Corridor. Today, countries in the region are enhancing these historical trade links as they seek to diversify their economies away from oil. They are actively creating business-friendly environments to attract foreign direct investment and build new trade partnerships.
This comes as the global order is becoming increasingly multipolar, with the ascent of emerging economies such as China, Russia, India and Turkiye. The Gulf states are navigating the new world order by positioning themselves as economic and geopolitical powerhouses. Key to this transition is diversifying trade and investment relations, particularly as the West turns its focus to the Asia-Pacific. This strategic pivot has enabled the Gulf states to expand their influence beyond the Arab world, reshaping their role in global trade and diplomacy.
Historically, the West, particularly the US and the EU, has been the key international trade partner for the Gulf Cooperation Council. Early Western investments in the region’s energy sector laid the foundation for enduring trade relationships. In 2023, the total trade value between the US and GCC countries surpassed $80 billion. The EU, similarly, has robust trade relations with the GCC and is the latter’s second-largest trade partner. In 2023, the EU accounted for 11.1 percent of the GCC’s total trade in goods.
Today, the Gulf is rapidly forming new trade partnerships with emerging economies, especially in Asia. China is the region’s largest trade partner and in 2023 accounted for more than 20 percent of the Gulf’s exports. It is closely followed by India, which accounted for 15 percent of Gulf energy exports. Asia now absorbs more than 70 percent of GCC oil and gas exports, with major consumers including China, India, Japan and South Korea. Africa is another priority region for GCC trade and investments as the Gulf secures its global influence. GCC investments in Africa, valued at more than $53 billion in 2023, have focused on infrastructure, energy and technology.
China and India are critical trade partners for the Gulf. With the world’s largest populations and ever-growing oil and gas demands, they are of particular relevance for the oil-exporting Gulf states. Between 2021 and 2022, Gulf-Asia trade grew by 34.7 percent, compared to a 32 percent increase in trade with the US, UK and Western Europe in the same period. Increased US self-sufficiency in oil production and Europe’s transition to renewable energy have reduced Western dependence on Gulf oil. This pivot toward Asia and Africa allows the Gulf states to secure their economic future and geopolitical influence in a multipolar world order.

The Gulf states are navigating the new world order by positioning themselves as economic and geopolitical powerhouses.

Zaid M. Belbagi

Despite a reorientation toward the Global South, the West remains relevant for the region. A forthcoming Gulf-UK free trade agreement is projected to boost trade by 16 percent, add $2.1 billion to the UK economy and allow the Gulf access to British technology, resources and expertise. This highlights the continued interdependence of the Gulf and its Western partners, a relationship that will not disappear but rather evolve as the Gulf boosts trade ties with emerging markets.
The GCC’s robust international trade is complemented by the rise of regional financial centers, notably the Dubai International Financial Centre, Abu Dhabi Global Market, King Abdullah Financial District and the Qatar Financial Centre. By creating a business-friendly environment through these institutions, the region is carving a place for itself in global finance and attracting significant FDI.
The Dubai and Abu Dhabi centers have emerged as leading financial hubs underpinned by English Common Law frameworks. These centers specialize in sectors like banking, fintech and sustainable finance, with a strong emphasis on innovation and digital transformation. The Dubai International Financial Centre reported a 24 percent growth in registered companies in the first half of 2024, while Abu Dhabi Global Market saw a 20 percent increase in licenses issued during the same period. Both centers have consistently reported increases in assets under management, reflecting their growing global appeal.
¶¶Òõ¶ÌÊÓƵ, through the creation of King Abdullah Financial District in Riyadh, is providing incentives for international investment in the Kingdom. With regulatory reforms, tax incentives and a business-friendly environment, it has become a significant financial hub. In 2024, 127 international companies moved their regional headquarters to Riyadh, including global technology giants Apple, Google and Microsoft. Between 2017 and 2023, FDI inflow to ¶¶Òõ¶ÌÊÓƵ increased by 61 percent to reach $215 billion, highlighting the success of the Kingdom’s Vision 2030 and its subsidiary Regional Headquarters Program in drawing international finance.
Faced with a multipolar global order, the Gulf states have found the opportunity to not only diversify trade partnerships but also position themselves as sites of economic and strategic influence. The success of their domestic financial hubs reflects the Gulf’s economic potential and its sustained ability to attract Western investments despite geopolitical disturbances and strategic realignment in the region. The upswing in international trade and investment between the Gulf and Western and emerging economies reinforces the Gulf’s position as an economic powerhouse.

• Zaid M. Belbagi is a political commentator and an adviser to private clients between London and the Gulf Cooperation Council. X: @Moulay_Zaid