Fast Tracking UAEs Decarbonization as well as Digitalization can create Nations-game shifting reforms

Cushioning and curbing the impact of the prevailing Covid-19 Pandemic is the utmost priority for the Emirates’ Monetary, Fiscal as well as Health Stimulus Packages.

This fiscal year has defined and checked out adjusting to one of the worst ever catastrophes affecting humanity over a decade as- from the partial or full strict lockdowns to remote working module as well as delaying global trade, investments as well as tourism, alongside a cleaner greener air which acted as rarest bright spot.

With the emergence of the latest COVID Pandemic strain of virus, as well as the relative lockdowns, the hope of a V-shaped recovery has weakened. Yet, in spite of the “Great Lockdown” consequential in a deep recession, markets are energetic amid prospects that the production and distribution of numerous vaccines will generate a path to normality in 2021.

Unlike the global monetary catastrophe from 2008 to 2009, which began as a cover bubble and a demand shock, the existing health crisis began as a supply shock that unsettled the global supply chains and triggered a spill over to the mandate side, where it hit trade, tourism and consumption.

Given the extensive effect of the pandemic and notwithstanding concerted financial and fiscal stimulus equal to 12 percent of the global gross domestic product, not only will the road to recovery be longer but the growing output damage will be much larger than during the 2008 financial crisis, with long-term mutilating of labour markets and economies expected.

The UAE’s collective pecuniary, fiscal and health stimulus package – equal to 18 percent of its GDP – moderated the economy after a demand-induced oil price shock and the effects of a global lockdown.

After numerous weeks of drive boundaries and rigorous health measures, the UAE’s public health system proved operative and resilient, consenting the economy to reopen earlier than provincial peers.

While maintaining social distancing and applying Covid-19 conventions to keep the community safe, the UAE reopened offices, businesses, permitted tourists to enter and effectively held events and conferences – both online and on site. This bodes well for the delayed Expo 2020 Dubai and the renewal of tourism.

With energy market unpredictability and persistent coronavirus-induced uncertainty, what activities can drive an economic recovery next year and care medium-term growth prospects?

Liberalisation and market admittance reforms are set to charm foreign investment, enhancement of the capital flows to the property market, boost workforce skills and sustenance of the innovation and efficiency progress.

For GCC oil producers, de-risking fossil fuel assets by following an approach of part-privatising and public-private partnerships in energy reserves, Arduous and downstream operations and correlated infrastructure such as channels is vital. This has in progress with Adnoc and Aramco.

With the reverberations of Covid-19, the UAE’s policy reforms were spot on – from the game-changing 100 percent overseas ownership of businesses to the remote occupied initiative to the retirement and 10-year residency visas for skilled authorities – amid the nation’s intents to become a knowledge-based, state-of-the-art economy.

With the oil worth obligatory to have an equilibrium budgets advanced than current charges, deficit funding instruments should be established by governments. We can expect novel government bonds to be issued forthcoming year that will inspire more corporate bond issuances and private debt placements.

The UAE is fast-tracking its decarbonisation energies, directing on energy efficiency, transitioning to renewable energy and construction on its leadership in renewable energy projects and investment in climate risk vindication and adaptation.

Superior investment in agriculture technology for food security, which includes bearable vertical farming and desert agriculture, should take place in tandem with the sustainability and vigour efficiency drive.

Decarbonisation and the diversification of the energy mix will be backing the progress of the UAE’s capital markets done the issuance of green bonds and sukuk, as well as the financing of PPP and privatisation deals for renewable energy and clean technology.

Indeed, the UAE can become a provincial, if not a global, centre for renewable energy finance.

Covid-19 has led to a robust impetus to digitise as working and learning from home became more popular. The UAE should figure on its strong e-commerce and e-services base by massively investing in 5G to provision the Internet of Things and building smart cities and infrastructure.

This is very vital for the retail sector to move online from brick-and-mortar shops. Liberalising the telecoms sector and curbing the costs of broadband services will help the nation become a fully digitised economy and a native hub for digital services.

The UAE has world-class fundamental infrastructure in transport and logistics, power and telecoms. These assets can serve infrastructure-poor nations in the province, East and Central Africa, India, Pakistan and Central Asia. Electricity from solar power can be exported through cross-country, integrated grids.

Finally, the UAE’s normalisation of relations with Israel announcers a new local economic geography: new trade and investment prospects, as well as the curbing of geopolitical tensions.

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