logo
Dubai serves as gateway for German businesses eyeing Pakistan market

Dubai serves as gateway for German businesses eyeing Pakistan market

Despite growing global economic headwinds resulting from an escalation in the US-China trade war, German companies are exploring business opportunities in Pakistan, with Dubai playing an important role as a regional hub.
Dr. Martin Henkelmann, CEO of the German Emirati Joint Council for Industry and Commerce (AHK UAE) and Florian Walther, Pakistan Representative at the German Emirati Joint Council for Industry and Commerce (AHK UAE) said this in an exclusive interview with Business Recorder.
AHK stands for 'Auslandshandelskammer' in German, which translates to 'Chamber of Commerce Abroad'. It is part of a global network that helps German companies establish and expand business operations in foreign markets, including Pakistan, it was learnt.
Dr. Henkelmann and Walther said Dubai serves as a strong regional hub for German companies looking to expand. Many firms from the European state – the third largest economy in the world after the US and China – are optimistic about exploring what a digitally booming Pakistan has to offer.
They are giving serious thought to finding new opportunities in areas like agriculture and agri-tech, IT and software development and fintech as well as smart and energy efficient construction.
Dr. Henkelmann said that a unique factor aiding Germany's engagement with Pakistan is the role of Dubai. There are some 1,800-2,000 German companies with regional headquarters in Dubai. AHK's presence there is instrumental in connecting German firms with opportunities in Pakistan.
'It is much easier to take a flight from Dubai to Karachi or to Islamabad and Lahore than getting someone from Germany flying six hours and then changing planes again,' he said, adding that 'we will have an event in the beginning of June where we address the regional directors of German companies based in Dubai and speak about Pakistan as an opportunity.'
Pakistan remains on Germany's radar
Walther said that over the past six months, at least four new German companies have either entered the Pakistani market or expanded their operations within the country, covering sectors such as financial services, energy-related machinery, and infrastructure technology.
'Two of them are in the financial services sector, one is in the energy sector and one is in the industrial/energy sector,' he said.
These investments come at a time when global corporations are reevaluating supply chains, rethinking expansion strategies, and exercising caution amid tariff wars, inflationary pressures, and geopolitical uncertainties. Yet, German firms are leaning in rather than pulling back, with many seeing Pakistan as a land of untapped potential, particularly in new and evolving sectors.
Walther further said that the business confidence of German firms is rising in Pakistan. 'We see positive signs,' he said.
Dr. Henkelmann added that a recent survey suggested that 'more than 40% of German firms already operating in Pakistan said we will invest more in the country, which is a good sign.'
'This is in contrast to a global environment where often companies don't want to invest because in general the situation is difficult,' he said.
The survey results showed that business confidence in the market is relatively high and '60% of German companies said that the next 12 months will be better'.
Dr. Henkelmann said the governments of Germany and Pakistan have had a good relationship for over 70 years.
'Pakistan has always been on the radar of German companies,' he said.
Walther added that the bilateral trade volume between Germany and Pakistan stands at $3.5 billion. Pakistan exports to Germany stand at around $2.5 billion, while Germany exports are worth $1 billion to Pakistan, 'which represents a positive trade balance of $1.5 billion for Pakistan.'
Germany is the largest contributor to EU-Pakistan trade (total EU trade with Pakistan was $12 billion in 2023).
A big chunk of Pakistan's exports to Germany (85%) come from the textile and apparel sector.
As far as Germany's exports to Pakistan are concerned, 35% is machinery and roughly 25% is chemicals. 'This shows we have a solid and strong base when it comes to the trade relationship between Germany and Pakistan,' Walther said.
On the flip side, they said, whenever they speak to German companies, whether they are in Germany, the UAE, or Pakistan, the main challenge hindering investment is policy inconsistency.
Over 60% of those surveyed highlighted economic policy conditions as a risk and another 50% saw the prices of energy as a risk in the next 12 months.
The two maintained that the Pakistan-Germany relationship is based on mutual opportunity and growth potential. They said Germany remains committed to strengthening trade and investment ties with Pakistan across both traditional and emerging sectors.
Copyright Business Recorder, 2025

Orange background

Try Our AI Features

Explore what Daily8 AI can do for you:

Comments

No comments yet...

Related Articles

Hyundai Motor has a rare earths stockpile that can last about a year, source says
Hyundai Motor has a rare earths stockpile that can last about a year, source says

Business Recorder

time2 hours ago

  • Business Recorder

Hyundai Motor has a rare earths stockpile that can last about a year, source says

SEOUL: Hyundai Motor has a rare earths stockpile that can last about a year and it does not expect any near-term impact from global supply chain disruptions caused by China's export curbs, said a person who attended a company investor call. China's decision in April to restrict exports of a wide range of rare earths and related magnets has tripped up the supply chains central to automakers, aerospace manufacturers, semiconductor companies and military contractors around the world. The stockpiling by Hyundai, the world's No.3 automaker along with its affiliate Kia Corp, indicates it is better-placed than many competitors to withstand restrictions that have already impacted production or the supplier network of companies including Ford and BMW. A Hyundai investor relations official said the South Korean automaker had 'far more wiggle room' than rivals with regard to rare earths-related supply chain issues affecting the industry, according to the attendee on the investor call, which was not open to the public. The official told investors Hyundai's efforts to diversify supply chains and improve procurement had succeeded and the company expected to be able to produce electric vehicles or hybrid cars without disruptions 'for at least about one year,' the attendee said. Hyundai also significantly boosted its rare earths inventories during a recent period when China had slightly relaxed its export restrictions, the official said, according to the attendee who spoke on condition of anonymity because the call was private. The South Korean automaker's stockpile of the key minerals had not been reported previously. It was not clear whether the inventory was solely stockpiled by Hyundai and its affiliate Kia or also included stocks held by their suppliers. In a statement to Reuters, Hyundai declined to comment on specific inventory details or procurement strategies. 'We continuously evaluate market conditions to ensure operational stability and maintain a diversified global supply chain,' Hyundai said. 'As part of our standard business practices, we maintain appropriate inventory levels to support uninterrupted production.' China produces around 90% of the world's rare earths, which are essential for the production of vehicles, especially electric vehicle motors. Hyundai India aims for 7%-8% annual exports growth after quarterly profit beat Hyundai Motor Group also holds about a one-year inventory of rare earths-related magnets needed for its mainstay EVs and hybrid vehicles, said a person familiar with the matter, declining to be named due to the sensitivity of the subject. China's dominance of the critical mineral industry is increasingly viewed as a key point of leverage for Beijing in the trade war sparked by US President Donald Trump's tariffs. US-China trade talks were set to extend to a second day in London on Tuesday as top economic officials from the world's two largest economies sought to defuse a bitter dispute that has widened from tariffs to restrictions over rare earths.

Iran's SLAL tenders for 120,000 tons each corn, barley and soymeal
Iran's SLAL tenders for 120,000 tons each corn, barley and soymeal

Business Recorder

time2 hours ago

  • Business Recorder

Iran's SLAL tenders for 120,000 tons each corn, barley and soymeal

HAMBURG: Iranian state-owned animal feed importer SLAL has received offers to supply up to 120,000 metric tons each of corn, barley and soymeal after it had issued international tenders, European traders said on Tuesday. The deadline for submission was Monday, they said, adding that the price offers were still being considered and that no purchase had been reported. The shipment of grains is expected to be in July and August. The corn can be sourced from Brazil, Europe, Russia, Ukraine or elsewhere in the Black Sea region, including Turkey. The barley can be sourced from the European Union, Russia, Ukraine or elsewhere in the Black Sea region, including Turkey or from Kazakhstan. The soymeal can be sourced from Brazil or Argentina only. South Korea's MFG buys estimated 199,000 tons corn, traders say Iranian businesses have been hit by payment issues as Western sanctions over the country's nuclear programme made overseas participation in recent tenders difficult, traders said. While sanctions exempt food, Iran's financial system has been affected, creating complex and erratic payment arrangements. Traders said Iran was offering payment via two banks, one in Iraq and one in Turkiye.

Oil rises as US-China talks counter OPEC supply worries
Oil rises as US-China talks counter OPEC supply worries

Business Recorder

time2 hours ago

  • Business Recorder

Oil rises as US-China talks counter OPEC supply worries

SINGAPORE: Oil prices climbed on Tuesday as investors awaited the outcome of US-China talks that could pave the way for easing trade tensions and improve fuel demand. Brent crude futures rose 22 cents, or 0.3%, to $67.26 a barrel by 0645 GMT. US West Texas Intermediate crude was up 18 cents, or 0.3%, at $65.47. On Monday, Brent had risen to $67.19, the highest since April 28, buoyed by the prospect of a US-China trade deal. US-China trade talks were set to continue for a second day in London as top officials aimed to ease tensions that have expanded from tariffs to rare earth curbs, risking global supply chain disruptions and slower growth. Prices have recovered as demand concerns have faded with the trade talks between Washington and Beijing and a favourable US jobs report, while there are risks to North American supply due to wildfires in Canada, Goldman Sachs analysts said. US President Donald Trump said on Monday that the talks with China were going well and he was 'only getting good reports' from his team in London. A trade deal between the US and China could support the global economic outlook and boost demand for commodities including oil. Elsewhere, Iran said it would soon hand a counter-proposal for a nuclear deal to the US in response to a US offer that Tehran deems 'unacceptable', while Trump made clear that the two sides remained at odds over whether the country would be allowed to continue enriching uranium on Iranian soil. Saudi Arabia cuts July oil prices to Asia to 4-year low after OPEC+ supply boost Iran is the third-largest producer among members of the Organization of the Petroleum Exporting Countries and any easing of US sanctions on Iran would allow it to export more oil, weighing on global crude prices. Meanwhile, a Reuters survey found that OPEC oil output rose in May, although the increase was limited as Iraq pumped below target to compensate for earlier overproduction and Saudi Arabia and the United Arab Emirates made smaller hikes than allowed. OPEC+, which pumps about half of the world's oil and includes OPEC members and allies such as Russia, is accelerating its plan to unwind its most recent layer of output cuts. 'The prospect of further hikes in OPEC supply continues to hang over the market,' Daniel Hynes, senior commodity strategist at ANZ, said in a note. 'A permanent shift to a market driven strategy (in OPEC) would push the oil market into a sizeable surplus in H2 2025 and almost surely lead to lower oil prices.'

DOWNLOAD THE APP

Get Started Now: Download the App

Ready to dive into the world of global news and events? Download our app today from your preferred app store and start exploring.
app-storeplay-store