UAE-UK trade pivotal in Emirates’ growth

Dubai: From its meteoric rise as an upstart regional carrier in 1985 with only two planes and a $10 million (Dh36.72 million) budget to today’s largest global carrier of international passengers replete with 200 wide-bodied aircraft, Emirates airline owes in part its remarkable growth to the UAE’s long-standing ties with the United Kingdom, says Emirates President Tim Clark.

And Emirates’ dramatic growth expected over the next five years and beyond firmly includes the UK’s manufacturing sector as a critical ingredient in the carrier’s strategy for success.

Clark said Emirates’ confidence in the UK as a pivotal partner is being bolstered by the state visit to the UK by President His Highness Shaikh Khalifa Bin Zayed Al Nahyan.

The royal visit beginning on Tuesday, Clark told Gulf News in an exclusive interview, “will be a step in the right direction” and will likely focus heavily on increasing bilateral trade between the two countries.

Figure will triple

Estimates that UK-UAE trade will reach Dh70 billion by 2015 are probably on the conservative side, Clark said, noting that he can easily see that figure trebled by the close of this decade.

“If you look to 2020, I think that this figure will triple. But the UAE has to play its cards right,” said Clark, whose airline now employs 44,000 people and is responsible for roughly 30 per cent of Dubai’s GDP.

One of the reasons for the mushrooming trade between the two countries is the full confidence of the UK government and the business community in the UAE as not only a rising emerging market force but also a country that is wisely governed resulting in a high degree of stability, he suggested.

Stability fosters confidence which in turn lends itself to foreign direct investment.

“It is certainly referred to as a country that is governed demonstrably well. The Brits look at the UAE as a model of the way that things can be done,” said Clark, a British expatriate, who joined Emirates in 1985 following four years working as a route planner for Bahrain’s Gulf Air.

Generally credited with building a sprawling global routes network for Emirates since its infancy, Clark was named president in 2003 and continues to see the airline’s  reach expand globally.

Today, the most financially critical route for Emirates is the UK flight path to and from Dubai which carries many of the one million UK visitors who land in the emirates every year.

Important market

“The UK is our most important market for revenue. We have 16 flights a day going to the UK,” he said.

“We are now the largest long-haul carrier into the United Kingdom which gives you a pointer as to how valuable the market is to the UK. France, Germany or Italy bear no comparison.”

The UK’s manufacturing sector is equally important given the island nation’s signature Rolls Royce company produces the jet engines for the Airbus A380 double decker aircraft upon which Emirates has banked heavily as a lead aircraft for the future.

“We have bought a lot of engines from Rolls Royce,” Clark said.
In addition, the wings assembly on the Airbus aircraft are also produced by UK workers at the Broughton aircraft factory, a former Second World War factory that produced more than 200 of the famous Avro Lancaster heavy bombers.

Now owned by Airbus, the factory serves as the central manufacturing point of wing production for all of Airbus models.

Clark said Emirates’ spend flowing through the Broughton facility for new Airbus aircraft is beyond $20 billion not including billions more in UK aviation purchases for avionics and undercarriage assemblies.

The spending supports countless UK jobs directly and indirectly through spin-off economics throughout, he said.

“The more we buy, the more we enrich the UK economy,” Clark said. “This is formidable stuff.”

Looking to diversify

With massive financial parterships at stake with the UAE, the UK government is looking to diversify its relations with new emerging economies.

“Now they’re [the Cameron government] looking much further afield for foreign trading partners and trading blocks,” Clark said. “I think the UAE is one of those.”

As the world’s largest international carrier, Clark said the UK is paying attention to Emirates’ undeniable purchasing power.

“With Boeing included, we have $65 billion [in new aircraft] on order,” Clark said.

By 2015, Emirates is expected to have taken delivery of 58 Airbus A380s and that number — barring production delays — is forecast to climb to 96 A380s by 2017, he said.