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UAE hits back at Iran with targeted economic measures
Ziggy Ojiegbe
The United Arab Emirates has launched a quiet but decisive economic response to repeated Iranian attacks on its industrial infrastructure, banning most Iranians from entering the country or transiting its airports while cracking down on networks linked to the Islamic Revolutionary Guard Corps (IRGC).
Rather than taking sweeping measures that might escalate the conflict, Abu Dhabi limited exemptions to Iranians holding long-term residency visas for business or property, skilled professionals, and family members of Emirati citizens. State-owned airlines Emirates, FlyDubai, and Etihad posted guidance late Tuesday outlining the new restrictions, which quickly circulated on social media.
The move has alarmed the Iranian expatriate community in the UAE, home to more than half a million Iranians, many of whom are connected to Tehran’s ruling elite. The UAE foreign ministry sought to calm fears Thursday, emphasizing that its approach follows “well-established procedures” to safeguard all residents and reflecting the country’s values of tolerance and coexistence.
In parallel, Emirati authorities have intensified scrutiny of Iranian-owned shell companies operating in free-trade zones. These entities, often acting as intermediaries, have been used by the IRGC to trade oil and petrochemicals with buyers in China via Singapore and Hong Kong. On March 20, the UAE State Security Apparatus said it dismantled a “terrorist network” operated by Iran and its Lebanese ally Hezbollah, aimed at laundering money, financing terrorism, and threatening national security.
Experts say these UAE-based financial channels have long helped Tehran bypass sanctions, with Iran-UAE trade peaking at $28.2 billion in 2024, equivalent to 22.6% of Iran’s foreign trade. The Emirates had overtaken Turkey to become Iran’s second-largest commercial partner after China, providing an economic “pressure valve” for the Islamic Republic.
Political analysts note that the UAE’s measures are intended to pressure Tehran without escalating militarily. “The UAE seems to be more assertive in its stance towards Iran, but is still in a defensive posture,” said Robert Mogielnicki, a Paris-based Gulf specialist. Farzan Sabet, an Iran expert at the Geneva Graduate Institute, said the travel bans target Iran’s economic elite and upper-middle-class stakeholders, increasing internal pressure on Tehran to adopt a more pragmatic approach.
The UAE has also lobbied Washington to take military action to reopen the Strait of Hormuz, which is critical to its trade, and to ensure that any peace deal addresses the Iranian drone and missile threat to Gulf states.
Domestically, the UAE faces pressure to further sever economic ties with Iran. Retired academic Abdulkhaleq Abdulla called for boycotts of Iranian goods and for Gulf states to halt all commercial and financial interactions with Tehran.
Analysts say that while the UAE’s economic lifeline to Iran is not vital to Abu Dhabi, the steps signal a broader strategic pivot. “In light of Abu Dhabi’s wealth and how far Dubai has developed as a Western Asian hub, the UAE can comfortably afford to cut Iran off,” Sabet said.
The measures mark a shift in the UAE’s approach: a calibrated, economically focused response designed to defend its interests, pressure Iran to end attacks, and strengthen ties with the United States and Israel, even if it comes at the expense of some regional relationships.
