On the second day of a four-day tour of the Gulf region, German Chancellor Angela Merkel paid a visit to Masdar City, a prestigious project that aims to become the world's first carbon- neutral city.

On Monday, Merkel wrapped up talks in Abu Dhabi with the United Arab Emirates (UAE) Minister for Economic Affairs, Sultan bin Saeed Mansouri. Abu Dhabi is the capital and richest of the United Arab Emirates' seven members.

Trade and nuclear proliferation in Iran were both topics of conversation. On Iran, Merkel said that the UAE and Germany share "the same safety concerns" and want to work more closely together on this goal.

Germany is the UAE'S largest European trading partner, a position Merkel said she hope to "solidify and of course expand."

Big money

Accompanied by a delegation of German business leaders, Merkel sealed contracts for plastic production and a natural gas service during her first stopover in Abu Dhabi, one of the most important economic partners for Germany in the Middle East.

The list of top managers on the trip reads like a Who's Who of Germany industry: Siemens chief Peter Loescher, Deutsche Bahn CEO Ruediger Grube, Linde CEO Wolfgang Reitzle and Eon-Ruhrgas Manager Bernhard Reutersberg.

The German Chamber of Industry and Commerce estimates that current projects in the Gulf are worth around 2.8 billion euros ($3.5 billion). Despite the economic downturn, the Gulf region still enjoys a strong economic growth rate that hardly ever dips below the 5 percent mark, thanks to its vast oil and gas resources. Between 2000 and 2008, German exports tripled in the Gulf region, before the global financial crisis hit and exports plunged.

Looking ahead

Merkel's next stop is Saudi Arabia where she intends to thank Riyadh for its support in securing the release of two German hostages held by militants in Yemen. She will also hold talks with Saudi businesswomen and give a speech at the King Abdullah University for Science and Technology, the first academic institution where men and women study on a equal footing.

On the final leg of her Gulf tour, Merkel will hold political talks with Bahrain before returning to Berlin.

smh/AFP/dpa
Editor: Rob Turner