The Gulf nation has taken up a humungous diversified approach for creation of a varied knowledge-backed economy that aid in channelling up technology.
The UAE, since its independence within 1971, it has rose from being an economic dependent regard pearl diving as well as fishing for a robust economic power as well as core kingpin on the global energy market.
The nation’s thought-focussed investment within infrastructure, that has aided for fastening it as a global trading as well as transportation hub, its thriving economic diversification as well as connecting technology that have placed it on a powerful footing for evolving further over the forthcoming fifty years.
Being the Opec’s third-largest member, and also the global Seventh-largest crude producer, as well as it amounts for 5.6 percent of global proven oil reserves, the nation’s multi-diversified futuristic approach is paying off.
The World’s Intellectual Property Organization’s Global Innovation Index ranks UAE in the 34th Position globally as comparatively to 47th during 2015. The nation has maintained its spot as the most prolonged competitive economy in the Middle East as well as North America in the World Economic Forum’s Global Competitiveness Index, which also ranks it to 25th globally. The World Bank’s ease of Doing Business Report deems the UAE as the 16th simplest place to set up a venture, a big progress from 2015 when it was ranked 34th.
Scott Livermore, Chief Economist as well as Managing Director at the Oxford’s Economics stated that “the UAE as a nation could not have achieved the economic success without the aid of Oil reserves for funding out the enhanced progressive phase, and as well as however, required the visionary leaders for realization of Oil bonanza.”
As per Carla Slim, an economist with the Middle East, North Africa as well as Pakistan at Standard Chartered Bank stated that “the UAEs non-oil economic standards have risen to almost up to ten-fold ever since 1985s, reaching out almost a close to an overall 70 percent of net gross domestic product last year in 2019. Ms. Slim further elaborated that keeping an overall stock regard the diversification strategy as well as the progress, is not however, restricted to the non-oil sector’s share of its overall GDP, as broadening the net also further includes general public funds, as well as balance of net transactional flows.”
She also further added that “the UAEs non-oil (Private) sector government revenue, in the same vein has in fact doubled within the shorter time frame of just Nine years since 2010-2019, aiding for ensuring of a medium-term Fiscal sustainability.”
Mr. Livermore stated that: “The UAE is not the solitary nation in Gulf overhauling its economic vitality. However, it has been the most prominent and overall best successful within its pursuit of diversifying its economic standards.”
The nation’s GDP has expanded from base of just within Dh11 Billion within 1973 to about Dh1.5 trillion in 2019. While the UAEs hydrocarbon-powered expansion is quite impressive by any standards, a three-year decline trend in Oil prices that began within the year 2014 did not decline the nation’s momentum, however thriving efforts have really payed them off well as to curb the overdependence on Oil and reserve-based economy.
The broader based economic service-from statutory reforms to a renewed thrust for FDIs, intensification as well as widening up the nation’s financial markets, the bolstering up of the native industrial base as well as huge scale infrastructural expansion- gathering pace over in forthcoming years.
Public spending targeted, subsidy reforms as well as opening of value-added tax surged efficiency while also as well gearing up for diversification of revenue streams.
As per the Swiss Business School IMD’s World Competitiveness Yearbook, the UAE at present ranks as the ninth-most competitive nation in the global scenario and at present is the only Arab Nation, to be featuring within the top 10 nations, ahead of even US, Germany and the UK.
Chief Economist at Abu Dhabi’s Commercial Bank Monica Malik, stated that: “The UAEs or any nation’s success largely depends upon its robust, streamlined yet core and integral, flexible Government policies, strategic dimension that is core for the economic developments and as well as making framework for a powerful regulatory framework, the ease within the business framework, as well as last but not the least expansion of diversified infrastructure also forms the crux of aiding factors.”
Ehsan Khoman, head of Mena research and strategy at MUFG Bank, stated further: “That the latest amendments for ownership rights and relative laws, will not just be able to shift the businesses landscape, however, will at same time yield out better expansion prospects by attracting better FDI flows further adding thrust to UAEs flourishing as well as dynamic business operational ecosystem, planned first-rated infrastructural modules, as well as well-knit-organized-diversified economy, that will thrive for the nation’s position as one of the most preferred business hubs across emerging Markets.”
The UAE now has its senses firmly stuck on the future and the expansion of the nation over the forthcoming 50 years. The previous month, the nation unveiled its roadmap for the future, which is concentrated on new technologies and artificial intelligence.
“As we look forward, latest industries will have to be developed for sustained economic growth. The global economy is moving – becoming more knowledge-based – and the modifications in the investment law will assist the expansion of latest sectors in the UAE,” Ms Malik of ADCB said.
“Oil will still be an indispensable part of the development agenda for decades to come,” she added.
The oil and gas sector are a major FDI contributor to the nation’s economy. State-owned Abu Dhabi National Oil Company assisted attract billions of dollars to the UAE through various deals that leverage its conventional crude asset base. Over the preceding four years, the company has aided drive Dh237bn in FDI flows to the UAE.
In November, the Supreme Petroleum Council also approved Adnoc’s plans to spend Dh448bn over the forthcoming five years, of which Dh160bn will be directed towards the native economy. “The UAE has very robust reserves on both the oil and the gas side and these are still going to be important commodities for the global economy,” Ms Malik said. “There are plans to invest strongly in the sector, so yes, the hydrocarbon sector will be important for economic growth.”
