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flag United Arab Emirates United Arab Emirates: Economic and Political Outline

In this page: Economic Indicators | Foreign Trade in Figures | Sources of General Economic Information | Political Outline

 

Economic Indicators

Benefiting from its political stability in a tumolous region and high oil prices, the United Arab Emirates (UAE) maintained sustained economic growth in 2013 (4.5%). The country's GDP is dominated by the economic strength of Abu Dhabi (60%), including its hydrocarbon production and management of almost all savings. Dubai participates at 26% of GDP and functions as the commercial platform of the Emirates, especially with its port and airport infrastructure. Economic growth of the UAE should accelerate in 2014, and in the long term the country's economy should receive an additional boost from its hosting of Expo 2020

The UAE economy in a fairly good shape, characterised by low inflation, growing tourism revenues and a lavish budget surplus. A slight slowdown of the oil sector growht in Abu Dhabi has been offset by the accelerating development of non-hydrocarbon activities in Dubai thanks to the country's effort to reform its financial sector. Similarly to its previous budget and in accordance with the three-year developmental plan for 2014-2016, the 2014 budget (12.5 billion USD) allocates half of the resources to social spending, especially focusing on healthcare, education, welfare and public servcies. In Dubai, a number of large-scale projects which had been suspended during the crises have now been given the green light and new projects have been also planned (such as Mohamed Bin Rashid City or MBR). Abu Dhabi is focusing on diversifying its economy and developing alternative energy sources. In 2017, it should launch a fleet of nuclear power plants and massively invest in renewable energies (the "Masdar" project costing USD 22 billion). It still needs to implement a more rigorous guidelines for the banking a real estate sector in order to avoid cyclical crises. Because it is aware of the finite nature of its oil resources, the UAE have lauched a policy of economic diversification in order to reduce it dependency on hydrocarbons and guarantee a more fair distribution of wealth. The strategy pursued is trying to take advantage of the complementarity between the different emirates. While Abu Dhabi has taken the lead in economic diversification, Dubai is primarily trying to develop its tourism.

The UAE has one of the highest per capita income levels in the world and a highly developed welfare system. It also has one of the lowest rates of unemployment in the Middle East (4.5%) and depends heavily on foreign labor (more than 85% of the workforce). A policy of "emiratization" has been launched to encourage the employment of the local workforce.

 
Main Indicators 20112012201320142015 (e)
GDP (billions USD) 347.45372.31402.34416.44440.18
GDP (Constant Prices, Annual % Change) 4.94.75.2e4.34.5
GDP per Capita (USD) 40,817e42,464e4444,77145,944
General Government Gross Debt (in % of GDP) 17.617.1e11.7e11.4e11.4
Inflation Rate (%) 0.90.71.1e2.22.5
Current Account (billions USD) 50.9568.9664.6846.3151.79
Current Account (in % of GDP) 14.718.516.111.1e11.8

Source: IMF - World Economic Outlook Database , Last Available Data

Note: (e) Estimated Data

Main Sectors of Industry

Agriculture contributes to less than 1% of the GDP. Raw material exploration accounts for nearly 36% of the GDP. United Arab Emirates is the 3rd largest oil producer in the world, with large reserves. Presently, their oil and gas reserves are estimated for 100 years of exploitation.

Manufacturing activities have witnessed an unprecedented growth in the last five years, particularly in sectors such as metal processing, furniture, industrial preparation of food stuffs, aluminum production, cement and construction materials, fertilizers, petrochemical industry, fiberglass and finally real estate.

As for tertiary sector (especially international trade, air transport, tourism, financial activities), it contributes up to 55% of the GDP

 
Breakdown of Economic Activity By Sector Agriculture Industry Services
Employment By Sector (in % of Total Employment) 3.8 23.1 73.1
Value Added (in % of GDP) 0.7 59.0 40.3
Value Added (Annual % Change) -1.2 5.7 4.6

Source: World Bank - Last Available Data.

 
 
 
Monetary Indicators 20092010201120122013
UAE Dirham (AED) - Average Annual Exchange Rate For 1 USD 3.673.673.673.673.67

Source: World Bank - Last Available Data.

 
 

Learn more about Market Analyses about the United Arab Emirates on Globaltrade.net, the Directory for International Trade Service Providers.

Indicator of Economic Freedom

Definition:

The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labor freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.

Score:
71.4/100
Position:
Mostly Free
World Rank:
28/178
Regional Rank:
2/15

Distribution of Economic freedom in the world
Source: 2014 Index of Economic freedom, Heritage Foundation

 

Business environment ranking

Definition:

The business rankings model measures the quality or attractiveness of the business environment in the 82 countries covered by The Economist Intelligence Unit’s Country Forecast reports. It examines ten separate criteria or categories, covering the political environment, the macroeconomic environment, market opportunities, policy towards free enterprise and competition, policy towards foreign investment, foreign trade and exchange controls, taxes, financing, the labour market and infrastructure.

Score:
7.22
World Rank:
30/82

Source: The Economist - Business Environment Rankings 2014-2018

 

Country Risk

See the country risk analysis provided by Coface.

 

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Foreign Trade in Figures

United Arab Emirates are amongst the world’s most dynamic markets in terms of foreign trade. It is amongst the world's 20 largest exporters and 25 largest importers of commodities. Its imports have grown at a rate higher than 20% on average per year. In 2009-2011, trade represented on average 150% of the GDP. United Arab Emirates has a trade surplus and has benefited from the rising oil prices.

In 2013, due to the imports rising more quickly than exports, the country's trade surplus diminished but still remains significant. WIth the development of exports unrelated to oil the UAE should retain its trade surplus. 

UAE is considered a central business hub of the Gulf countries, Iran, South Asia and East Africa. The main UAE trade partners are Japan, South Korea, Thailand, Singapore, China and Pakistan. The main products exported by the country are hydrocarbons, natural gas, dried fish and dates. Its main suppliers are India, China, the United States, Germany and Japan. The United Arab Emirates mainly imports machinery, transport equipment, chemical products and food stuffs

 
Foreign Trade Indicators 20092010201120122013
Imports of Goods (million USD) 150,000165,000205,000230,000245,000
Exports of Goods (million USD) 185,000220,000285,000350,000365,000
Imports of Services (million USD) 36,79941,33755,70214,279-
Exports of Services (million USD) 9,50311,02812,06314,279-
Imports of Goods and Services (Annual % Change) -15.72.118.814.510.5
Exports of Goods and Services (Annual % Change) -4.60.520.713.15.7
Imports of Goods and Services (in % of GDP) 73.872.272.575.477.7
Exports of Goods and Services (in % of GDP) 79.778.890.697.998.4
Foreign Trade (in % of GDP) 153.5151.0163.1173.3176.1

Source: WTO - World Trade Organization ; World Bank , Last Available Data

 

Main Partner Countries

Main Customers
(% of Exports)
2011
India 9.6%
Iran 5.6%
Switzerland 1.9%
Iraq 1.3%
Saudi Arabia 1.3%
See More Countries 80.3%
Main Suppliers
(% of Imports)
2011
India 13.6%
China 7.1%
United States 6.9%
Germany 4.0%
Japan 3.9%
See More Countries 64.6%

Source: Comtrade, Last Available Data

 
 

Main Products

- bn USD of products exported in 2011
Petroleum oils and oils obtained from bituminous...Petroleum oils and oils obtained from bituminous minerals, crude 36.4%
Gold, incl. gold plated with platinum, unwrought...Gold, incl. gold plated with platinum, unwrought or not further worked than semi-manufactured or in powder form 7.2%
Diamonds, whether or not worked, but not mounted...Diamonds, whether or not worked, but not mounted or set (excl. unmounted stones for pick-up styluses, worked stones, suitable for use as parts of meters, measuring instruments or other articles of chapter 90) 6.8%
Petroleum oils and oils obtained from bituminous...Petroleum oils and oils obtained from bituminous minerals (excl. crude); preparations containing >= 70% by weight of petroleum oils or of oils obtained from bituminous minerals, these oils being the basic constituents of the preparations, n.e.s.; waste oils containing mainly petroleum or bituminous minerals 4.0%
Articles of jewellery and parts thereof, of...Articles of jewellery and parts thereof, of precious metal or of metal clad with precious metal (excl. articles > 100 years old) 2.2%
See More Products 43.5%
- bn USD of products imported in 2011
Gold, incl. gold plated with platinum, unwrought...Gold, incl. gold plated with platinum, unwrought or not further worked than semi-manufactured or in powder form 12.9%
Diamonds, whether or not worked, but not mounted...Diamonds, whether or not worked, but not mounted or set (excl. unmounted stones for pick-up styluses, worked stones, suitable for use as parts of meters, measuring instruments or other articles of chapter 90) 7.7%
Motor cars and other motor vehicles principally...Motor cars and other motor vehicles principally designed for the transport of persons, incl. station wagons and racing cars (excl. motor vehicles of heading 8702) 3.6%
Articles of jewellery and parts thereof, of...Articles of jewellery and parts thereof, of precious metal or of metal clad with precious metal (excl. articles > 100 years old) 3.0%
Powered aircraft e.g. helicopters and aeroplanes;...Powered aircraft e.g. helicopters and aeroplanes; spacecraft, incl. satellites, and suborbital and spacecraft launch vehicles 1.8%
See More Products 71.0%

Source: Comtrade, Last Available Data

 
See More Products
More imports (Intracen Data)
More exports (Intracen Data)
 
 
 

Main Services

- bn USD of services exported in 2010
73.09%
20.88%
6.03%
- bn USD of services imported in 2010
60.11%
36.01%
3.88%

Source: Comtrade, Last Available Data

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Sources of General Economic Information

Ministries
Website of the Ministry of Economy
Website of the Ministry of Finance
Statistical Office
Office of Statistics-Dubai Municipality
Central Bank
Central Bank of the United Arab Emirates
Stock Exchange
Dubai International Financial Exchange
Abu Dhabi Stock Exchange
Search Engines
UAE Internet pages
Fares
Economic Portals
Erutledge

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Political Outline

Executive Power
Each Emirate is governed by an Emir and is under his administration. Every Emir preserves the autonomy for management of his Emirate's resources.
The Supreme Council of Emirs is the highest authority of UAE; it holds legislative and executive powers. The Emir of Abu Dhabi, the biggest oil producing Emirate, has been President in 2004 and succeeded from his father. The Emir of Dubai has been nominated the Vice-President and Prime Minister.
Legislative Power
There is only one Chamber: The National Federal Council. It consists of 40 members of which 20 are appointed by the President and 20 are elected, each Emirate has a number of representatives equivalent to its demographical weight. Their mandate is for two years. This council has only consultative functions.
Main Political Parties
There are no political parties.
Current Political Leaders
President: Sheikh Khalifa bin Zayed Al Nahayan (since November 2004)
Prime Minister: Sheikh Mohammed bin Rashid Al Maktoum (since January 2006)
Next Election Dates
Presidential Election: 2014
Designation of members of the National Federal Council: 2015
 

Indicator of Freedom of the Press

Definition:

The world rankings, published annually, measures the violations of press freedom worldwide. It reflects the degree of freedom enjoyed by journalists, the media and digital citizens of each country and the means used by states to respect and uphold this freedom. Finally, a note and a position are assigned to each country. To compile this index, Reporters Without Borders (RWB) prepared a questionnaire sent to partner organizations,150 RWB correspondents, journalists, researchers, jurists and activists of human rights, including the main criteria - 44 in total - to assess the situation of press freedom in a given country. It includes every kind of direct attacks against journalists and digital citizens (murders, imprisonment, assault, threats, etc.) or against the media (censorship, confiscation, searches and harassment etc.).

World Rank:
118/180
Evolution:
4 places down compared to 2013

Source: Worldwide Press Freedom Index 2014, Reporters Without Borders

 

Indicator of Political Freedom

Definition:

The Indicator of Political Freedom provides an annual evaluation of the state of freedom in a country as experienced by individuals. The survey measures freedom according to two broad categories: political rights and civil liberties. The ratings process is based on a checklist of 10 political rights questions (on Electoral Process, Political Pluralism and Participation, Functioning of Government) and 15 civil liberties questions (on Freedom of Expression, Belief, Associational and Organizational Rights, Rule of Law, Personal Autonomy and Individual Rights). Scores are awarded to each of these questions on a scale of 0 to 4, where a score of 0 represents the smallest degree and 4 the greatest degree of rights or liberties present. The total score awarded to the political rights and civil liberties checklist determines the political rights and civil liberties rating. Each rating of 1 through 7, with 1 representing the highest and 7 the lowest level of freedom, corresponds to a range of total scores.

Ranking:
Not Free
Political Freedom:
6/7

Map of freedom 2014
Source: Freedom House

 

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Last Updates: October 2014