Abu Dhabi is discussing the creation of a new defence fund for global investments
Officials in Abu Dhabi are holding preliminary talks on setting up a new investment mechanism focused on the defence sector. This was reported by sources familiar with the consultations, according to Bloomberg.
According to the sources, the initiative aims to centralise efforts to acquire stakes in global defence companies and expand domestic production in the United Arab Emirates.
Senior officials and business leaders from Abu Dhabi are taking part in the talks, including Crown Prince Sheikh Khaled bin Mohammed Al Nahyan and the CEO of Mubadala Investment Co., Khaldoon Al Mubarak.
It is expected that the new entity will be able to invest in defence manufacturers worldwide to diversify supplies to the UAE. According to sources, investments could include major companies in Europe and the US, Ukrainian and Turkish drone manufacturers, as well as technology start-ups.
Abu Dhabi is one of the world’s wealthiest cities. The emirate’s sovereign wealth funds control assets worth nearly $2 trillion. The authorities have previously invested billions of dollars in the financial sector and artificial intelligence.
Discussions regarding the structure and strategy of the new mechanism are at an early stage, and a final decision on its creation has not yet been made. Representatives of the UAE Ministry of Foreign Affairs did not respond to requests for comment, and the company also declined to comment.
At the end of last month, the UAE decided to withdraw from OPEC. Against this backdrop, Abu Dhabi is stepping up its political and security strategy.
The negotiations are also taking place following several regional conflicts in recent years. During the war with Iran, the Gulf states were subjected to drone and missile attacks for several weeks. According to the report, Iran attacked the UAE more frequently than other states in response to the conflict initiated by the US and Israel, although most of the targets were intercepted by a multi-layered air defence system.
The new mechanism could be established outside the existing sovereign wealth funds and Abu Dhabi’s current defence companies. The emirate has previously created separate sector-specific platforms, notably MGX for artificial intelligence and the financial holding company Judan.
According to Bloomberg, Mubadala invested $39 billion in 2025, whilst MGX plans to invest up to $10 billion annually over the coming years.
According to the Stockholm International Peace Research Institute, the UAE accounted for 2.7% of global arms imports between 2021 and 2025. The country possesses Patriot and THAAD systems, F-16 fighter jets and Black Hawk helicopters. Its main suppliers are the US, France and South Korea.
In March, Washington accelerated the sale of air defence systems, radars and missiles to allies in the Middle East, notably the UAE and Kuwait, worth up to $16.5 billion.
Ukraine has also signed defence agreements with some Gulf states, drawing on the experience in countering drones gained over four years of Russian attacks.
