FIW-PB 77 The Gulf and the Bosporus: Austria’s Trade Relations with the UAE, Saudi Arabia and Türkiye

Abstract: This policy brief discusses recent macroeconomic and trade developments in the United Arab Emirates, Saudi Arabia and Türkiye as well as the patterns of their trade with Austria, identifying where Austrian exporters are well positioned and where structural obstacles remain. Against a backdrop of geoeconomic fragmentation, the trade-policy turn in the United States and maturing demand in Austria’s established European markets, the diversification of export destinations has gained importance for Austrian economic policy. The three economies are large markets with distinct features: the UAE’s role as a regional trade hub and its rapidly expanding network of trade agreements; Saudi Arabia’s fossil-fuel-based economy with a large state-led investment programme to diversify it and a series of major international events ahead, and Türkiye’s integration into European value chains through the customs union and the international reach of its construction sector. Austrian firms export to all three from positions of relative strength in machinery, metals, wood and paper products and instruments, sectors that correspond closely to the demand these economies are expected to generate. At the same time, the three markets account for 5.5% of Austria’s extra-EU exports and Austria’s market shares have developed less dynamically than those of other EU exporters over the past decade, which points to scope for expansion. A gravity-model analysis indicates that a free trade agreement between the EU and the UAE of the kind the EU has concluded with other partners could raise Austrian exports to the UAE by about 18% in the medium to long run, with the largest effects in transport equipment, metals and chemicals. The brief concludes that the sectoral basis for a stronger Austrian presence exists and that the EU–UAE agreement, presence in the procurement networks of the Gulf, including through Türkiye, and the modernisation of the customs union are the main levers for realising it, while the geopolitical shocks of 2026 add uncertainty that cannot yet be quantified.

Heider Kariem (Austrian Institute of Economic Research (WIFO))
The Gulf and the Bosporus: Austria’s Trade Relations with the UAE, Saudi Arabia and Türkiye
FIW-Policy Brief 77
November 2026
Language: English