Influx of Chinese businesses reflects DIFC’s emergence as a strategic gateway to the region
• Interest from Chinese companies has surged during 2024
• DIFC home to broad range of economically significant Chinese firms, and the only regional financial centre to attract Chinese banks
• Top 5 Chinese banks in DIFC contribute more than 30 per cent of total assets in DIFC’s Banking and Capital Markets sector
Dubai International Financial Centre (DIFC), the leading global financial hub in the Middle East, Africa and South Asia (MEASA) region, has strengthened its position as a strategic gateway to the region, for Chinese financial institutions and multinational firms. Chinese firms are using DIFC to access markets across the MEASA region, as well as Belt and Road Initiative (BRI) member countries which have strong connectivity through Dubai.
During 2024, the Centre has witnessed a surge in interest from banks, wealth and asset management firms, large corporations and organisations in the (re)insurance sector, primarily attributed to 40 years of diplomatic relations between the UAE and China.
The biggest names in the Chinese banking and financial services industry have set up operations out of DIFC, with 30 per cent of these entities from the country being Global Fortune 500 companies. Last month, Bank of Communications opened its regional headquarters in DIFC, joining other financial institutions including Agricultural Bank of China, Bank of China, China International Capital Corporation Securities Limited, CMB International Securities Limited, Construction Bank of China, Industrial and Commercial Bank of China and SINOSURE. Large corporates and multinationals such as CNPC, Li Auto, NIO, Sinopec, State Grid Corporation of China, Terminus and ZTE have also established their presence in DIFC’s thriving ecosystem.
DIFC is home to the UAE’s only cluster of Chinese financial companies including the largest five banks, which collectively contribute over 30 per cent of the Centre’s total Banking and Capital Markets Assets. Chinese banks are actively issuing bonds on Nasdaq Dubai, including green bonds, with proceeds being used for renewable energy, seawater desalination, clean energy and transportation projects in the UAE and the wider region. Over the years, Chinese issuers have listed over USD 22bn in debt on Nasdaq Dubai. Most recently, in November, bonds worth USD 2bn were listed on Nasdaq Dubai by China’s Ministry of Finance.
The Dubai Financial Services Authority (DFSA), the independent regulator for business conducted in or from DIFC, has also recorded an increase in applications and interest from the Chinese market. Most recently, the DFSA, in association with the Alternative Investment Management Association (AIMA), co-hosted a familiarisation visit for wealth and asset management firms from China who are looking to establish a presence in DIFC.
Arif Amiri, Chief Executive Officer at, DIFC Authority, said: “DIFC has become the financial centre of choice for Chinese entities within the finance sector as well as multinational companies. Economic ties between the UAE and China continue to deepen as the two countries mark their fortieth year of diplomatic relations. We remain committed to providing Chinese businesses with the best-in-class platform that will help shape their growth and expansion within the Middle East, Africa and South Asia region. Our infrastructure and regulatory framework support these goals, reinforcing DIFC’s commitment to driving economic growth and steering the future of finance.”
According to Dubai FDI Monitor, in the first half of 2024, China announced 25 FDI projects in Dubai, totalling USD 122mn in investments. This marks a significant portion of Dubai’s foreign direct investment, highlighting the growing role of Chinese businesses in the region. Chinese investments in the UAE totalled USD 7.7bn between 2003 and 2023. Dubai has remained a top destination for Chinese investments, ranking among the top 3 globally for investment value.
The UAE is China’s second-largest trading partner (2022-2023). Trade between the two countries has reached USD 81bn in 2023, and is expected to increase to USD 200bn by 2030. The country is China’s most important strategic business partner in the Arab region, with about 60 per cent of Chinese trade being re-exported through UAE ports to more than 400 regional cities.