BERLIN, GERMANY / RankWire.AI / – The United Arab Emirates is set to channel €40 billion into various sectors within Germany, focusing on industry, technology, energy, and digital infrastructure. This financial commitment was unveiled during President Sheikh Mohamed bin Zayed Al Nahyan’s official state visit to Germany. German Chancellor Friedrich Merz participated in discussions concerning these new economic pledges. Of the total, €10 billion is allocated specifically for investments in Bavaria, with a focus on artificial intelligence, cutting-edge technology, and initiatives linked to Germany’s industrial sector.
A significant part of this investment plan emphasizes digital infrastructure. Both nations have outlined strategies to develop advanced data centres with a combined capacity of approximately 1 gigawatt. Germany expressed its support for the necessary conditions to facilitate these projects. The broader package also promotes collaboration in energy and industrial innovation. These measures form part of a broader set of agreements sealed during the state visit, which brought together representatives from government and industry from both countries.
During the visit, companies from the UAE and Germany formalized 29 agreements and memoranda, valued at over €9.356 billion. Additionally, the two governments agreed to establish a German-UAE Investment Council as a platform for public institutions and private firms engaged in bilateral investment efforts. A new Strategic Dialogue will oversee areas including trade, investment, technology, energy, transport, education, security, and other sectors. These mechanisms are integral parts of the broader set of commitments announced during the state visit.
Data centres identified as core component of the investment plan
This €40 billion initiative supplements existing UAE-related investments in Germany. For example, XRG has invested roughly €15 billion in the German chemicals manufacturer Covestro. The governments also highlighted commercial dealings involving Covestro, RWE, ADNOC, and Masdar as elements of the expanding bilateral economic relationship. These ongoing projects coexist with the newly announced investment plan, which is not intended to replace but to complement it. The latest commitments span multiple sectors, including industry, artificial intelligence, digital infrastructure, advanced technology, and energy.
Trade flows between the two nations have also grown. In 2025, UAE-Germany non-oil trade reached $15.5 billion, representing an increase of over 14% from the previous year. Cumulative investments from 2021 to 2025 have surpassed $10 billion. Moreover, both countries supported negotiations for a comprehensive trade agreement between the UAE and the European Union. The governments emphasized that these discussions should cover bilateral trade relations and establish a broader framework for commercial cooperation.
Broader bilateral agreements beyond trade and investment
The state visit resulted in agreements across several additional domains. Cooperation was announced in areas including energy, data centres, air transport, legal assistance, environmental issues, security, and information systems. An exploration of a defence and security cooperation framework was also agreed upon. The Strategic Dialogue is intended to serve as an official channel for collaboration across these sectors. Sheikh Mohamed’s visit marked the first-ever state visit by a UAE president to Germany, representing a significant diplomatic milestone in the bilateral relationship.
Germany and the UAE formalized their strategic partnership in 2004. The recent announcements extend this relationship with new investment and commercial initiatives. Central to the economic commitments remains the €40 billion investment package, which includes €10 billion designated for Bavaria and plans for approximately 1 gigawatt of data-centre capacity. The 29 commercial agreements, valued at more than €9.356 billion, further reinforce the growing economic ties through diverse sectoral commitments.