The UAE has an open economy with
a high per capita income and a sizable annual trade surplus.
Its wealth is based on oil and gas output as well as tourism
(about 33% of GDP), and the fortunes of the economy
fluctuate with the prices of those commodities. Since 1973,
the UAE has undergone a profound transformation from an
impoverished region of small desert principalities to a
modern state with a high standard of living. At present
levels of production, oil and gas reserves should last for
over 100 years. Despite higher oil revenues in 1999, the
government has not drawn back from the economic reforms
implemented during the 1998 oil price depression. The
government has increased spending on job creation and
infrastructure expansion and is opening up its utilities to
greater private-sector involvement.
Expatriates from India and Pakistan perform a significant role in the local
economy. However, to control illegal immigration into the country, on November
9, 2002, the UAE immigration ministry announced that all Indians visiting the
country must have a return ticket.
GDP: purchasing power parity $111.3 billion (2005 est.)[1]
GDP - real growth rate: 6.7% (2005 est.)[2]
GDP - per capita: purchasing power parity $43,400 (2005
est.)[3]
GDP - composition by sector:
Agriculture : 4%
Industry : 58.5%
Services : 37.5% (2002 est.)
Population below poverty line: NA%
Household income or consumption by percentage share:
lowest 10%: NA%
highest 10%: NA% Inflation rate (consumer prices): 3.2% (2003 est.)
Labour force: 2.16 million (2003),
note: 73.9% of the population in the 15-64 age group is
non-national (2003)
Labour force - by occupation: services 78%, industry
15%, agriculture 7% (2000 est.) Unemployment rate: 2.4% (2001) Note: unemployment
among non citizens is practically non existent, while
unemployment among Emaratis is reportedly as high as 15%
Budget: revenues: $17.35 billion
Expenditures: $23.85 billion, including capital expenditures
of $3.4 billion (2003 est.)
Industries: petroleum, fishing, petrochemicals, construction
materials, some boat building, handicrafts, pearling
Electricity - production: 37.74 TWh (2001)
Electricity - production by source:
Fossil fuel: 100%
Hydro: 0%
Nuclear: 0%
Other: 0% (1998)
Electricity - consumption: 35.1 TWh (2001)
Electricity - exports: 0 kWh (1998)
Electricity - imports: 0 kWh (1998)
Agriculture - products: dates, vegetables, watermelons;
poultry, eggs, dairy products; fish
Exports: $56.73 billion (f.o.b., 2003 est.)
Exports - commodities: crude oil 45%, natural gas, reexports,
dried fish, dates
Exports - partners: Japan 26.8%, South Korea 9.5%, Iran 3.8%
(2003 est.)
Imports: $37.16 billion (f.o.b., 2003 est.)
Imports - commodities: machinery and transport equipment,
chemicals, food
Imports - partners: China 10.9%, Japan 7.9%, Germany 7.8%,
US 7.6%, France 7.5%, UK 6.5%, Italy 4.8%, India 4.4% (2003
est.)
Debt - external: $20.71 billion (2003 est.)
Economic aid - recipient: $NA
Currency: 1 United Arab Emirates dirham = 100 fils
Exchange rates: Emirati dirhams per US dollar - 3.67 (2003),
3.6725 (2002), 3.6725 (2001), 3.6725 (2000), 3.6725 (1999)
Fiscal year : calendar year
Economy of the United Arab Emirates
Prior to the first exports of oil in 1962, the United Arab
Emirates economy was dominated by pearl production, fishing,
agriculture, and herding. Since the rise of oil prices in
1973, however, petroleum has dominated the economy,
accounting for most of its export earnings and providing
significant opportunities for investment. The UAE has huge
proven oil reserves, estimated at 98.2 billion barrels (16
km) in 1998, with gas reserves estimated at 5.8 km. At
present production rates, these supplies would last well
over 150 years.
Macro-economic trend
This is a chart of trend of gross domestic product of United
Arab Emirates at market prices estimated by the
International Monetary Fund with figures in millions of
Dirhams.
Year
Gross Domestic Product
US Dollar Exchange
Inflation Index (2000=100)
1980
109,833
3.70 Dirhams
46
1985
100,400
3.67 Dirhams
57
1990
123,541
3.67 Dirhams
69
1995
157,144
3.67 Dirhams
89
2000
259,247
3.67 Dirhams
100
2005
491,265
3.67 Dirhams
121
For purchasing power parity comparisons, the US Dollar is
exchanged at 4.41 Dirhams only.
In 2003, the UAE produced about 2.3 million barrels (370,000
m) of oil per day--of which Abu Dhabi produced
approximately 85%--with Dubai, and Sharjah to a much lesser
extent, producing the rest. Indeed, estimates say that Dubai
has less than 10 years of oil left at current production
levels and Sharjah has less. Sharjah however, does have some
gas reserves remaining. Dubai's small remaining gas reserves
are earmarked for use by Dubai, which is one of the largest
aluminium smelters in the world, with a very low cost per
tonne of production, thanks in part to its energy needs
being met by these gas reserves.
Major increases in imports occurred in manufactured goods,
machinery, and transportation equipment, which together
accounted for 70% of total imports. Another important
foreign exchange earner, the Abu Dhabi Investment
Authority--which controls the investments of Abu Dhabi, the
wealthiest emirate--manages an estimated $360 billion in
overseas investments.
More than 200 factories operate at the Jebel Ali complex in
Dubai, which includes a deep-water port and a free trade
zone for manufacturing and distribution in which all goods
for re-export or transhipment enjoy a 100% duty exemption. A
major power plant with associated water desalination units,
an aluminium smelter, and a steel fabrication unit are
prominent facilities in the complex. The complex is
currently undergoing expansion, with sections of land set
aside for different sectors of industry. A large
international passenger and cargo airport, with associated
logistics, manufacturing and hospitality industries, is also
planned here.
Except in the free trade zone, the UAE requires at least 51%
local citizen ownership in all businesses operating in the
country as part of its attempt to place Emiratis into
leadership positions. However, this law is under review and
the majority ownership clause will very likely be scrapped,
to bring the country into line with World Trade Organisation
regulations.
As a member of the Gulf Cooperation Council (GCC), the UAE
participates in the wide range of GCC activities that focus
on economic issues. These include regular consultations and
development of common policies covering trade, investment,
banking and finance, transportation, telecommunications, and
other technical areas, including protection of intellectual
property rights.
Recently, the Emirate of Dubai has started to look for other
sources of revenue. High-class tourism and international
finance are the new sectors starting to be developed. In
line with this, the Dubai International Financial Centre was
announced, offering 100% foreign ownership, no tax, freehold
land and office space and a tailor-made financial regulatory
system with laws taken from best practice in other leading
financial centres like New York, London, Zrich and
Singapore. A new stock market for regional companies and
other initiatives were announced in DIFC. Dubai has also
developed Internet and Media free zones, offering 100%
foreign ownership, no tax office space for the worlds
leading ICT and media companies, with the latest
communications infrastructure to service them. Many of the
world's leading companies have now set up shop there. Recent
liberalisation in the property market allowing non citizens
to buy freehold land has resulted in a major boom in the
construction and real estate sectors, with several signature
developments such as the 2 palm islands, the World, Dubai
Marina, Jumeirah Lake Towers, and a number of other
developments, offering villas and high rise apartments and
office space.
In 2001, budgeted government revenues were about AED 29.7
billion, and expenditures were about AED 22.9 billion.