United Arab Emirates Economic Overview

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The UAE is a federal state, established in 1971, located in the Middle East between the Persian Gulf and the Gulf of Oman and consists of seven emirates: Abu Dhabi, Ajman, Sharjah, Dubai, Fujairah, Ras al Khaimah and Umm al Quwain. Its federal capital is the city of Abu Dhabi.

The UAE are among the largest producers and exporters of oil.

The main oil and gas reserves in the Emirate of Abu Dhabi, already a member of OPEC before the creation of the federation. The seven Emirates are not equal to each other in terms of oil resources.

The emirate of Dubai has turned in recent years to new resources such as free ports, new technologies and especially luxury tourism. The city of Dubai has also become the economic capital of the federation.

Demographic data

Population: 9.86 million inhabitants in 2016 (IMF estimate)

Density: 48 / km²

Growth rate of the population: 3%

Fertility rate: 2.37

Life expectancy at birth: 77 years

Literacy rate: 91%

Religions: Muslim 76% (Sunni 85%, Shia 15%, Islam the official religion), Christian (9%) Other 15%

Human Development Index: 41th world rank

Economic data

(Directorate General of the Treasury / IMF. The 2015-2016 data is forecast to stage)

Nominal GDP of the Federation (2016): $ 356 billion

GDP per capita PPP (2016): $ 36.126 / hab

growth rate (2016): 2.6%

Unemployment rate: 14%

Inflation rate (2016): 3%

Public debt (2016): 18.3% of GDP

Public balance (2016): -4% of GDP

Exports (2015): $ 323.8 billion

Imports (2015): $ 248.2 billion

Balance of Payments (2016): $ 10.2 billion

Main clients (2014): Japan 14.8%, Iran 11.4%, India 9.6%, South Korea 5.7%, China 5.5%, Singapore 5.4%, Thailand 4.5%

Major suppliers (2014): China 15.7%, India 13.4%, US 8.9%, Germany 5.3%

Crude Oil Production (2016): 2.92 mb / d (including Abu Dhabi, 90%)

oil reserves (2014): 8th oil reserves in the world (5.8% of world reserves);

98 billion barrels

7th world gas reserves (3.3% of total)

17th World Gas producer (2015) (source: BP 2015)

GDP composition by sector:

Agriculture: 0.6%

Industry: 58.9%

Services: 40.5%

total trade volume: € 4.93 billion in 2015 (-4.6% compared to 2014)

Exports: € 3.8 billion in 2015 (- 6.3%)

Imports: 1.09 bn € in 2015 (+ 2%)

Trade surplus: € 2.75 billion in 2015 (-9.3%). 4th global surplus.

The UAE is our 21th customer and our 47th supplier. Respectively 20th and 47th in 2014.

French Market share: 1.8%

The economy ministry’s website and Finance offers more statistics.

French community

Nearly 24,000 French settled in the UAE, of which 20247 on June 30, 2015. Third community in the Middle East after Lebanon and Israel, it is concentrated in Dubai (2/3, more than 15,000), Abu Dhabi about 600 ) and Sharjah. Other cities, Al Ain, Ajman and Fujairah, greet several hundred French. The growth of the community is strong (15% / year since 2006) and supports the country’s economic boom. The choice of Dubai as the host city of the 2020 World Expo is expected to reinforce this trend. Five French establishments of the AEFE or AFLEC enroll over 8000 students.

Domestic policy

Founded December 2, 1971 at the departure of the British, the federation of the UAE consists of seven emirates (dominated by those of Abu Dhabi and Dubai) and a population of 9.3 million inhabitants, of which about 12% nationals. Since 2 November 2004 the President of the Federation is exercised by Sheikh Khalifa bin Zayed Al Nahyan, Ruler of Abu Dhabi.

UAE leaders, thanks to oil revenues and their location, built in 43 years a prosperous and modern society: a “hub” globalized, open and multicultural. This ambition derives a social contract that sees the authorities provide to local people prosperous living conditions, in exchange for acceptance of the proposed model. This “social contract” applies to expatriates who enjoy extensive freedoms.

Supreme Council brings together the seven emirs. The Federal National Council, composed of 40 members, half elected by an electorate expanded in 2010 (130 000 electors), acts as a “Parliament” the largely advisory role. After the last elections in CNF in September 2015, eight women sit there (20%), whose president. The emirate of Abu Dhabi and the Al Nahyan dynasty dominated by oil wealth. The economic crisis of 2008 and the financial rescue Dubai from Abu Dhabi fund has forced the city-emirate to give up his federal ambitions. The five Northern Emirates, smaller and less prosperous, can hardly challenge the leadership of Abu Dhabi. However, each emirate has a wide autonomy in many areas.

The resurgence of political Islam in the context of the Arab Spring, the UAE authorities concerned. Their struggle displayed against the Muslim Brotherhood and their values determines the main strategic focus of foreign policy: avoid installation in their close environment of an Islamic power likely to spread his ideas in the country.

The company challenged the model are repressed by the authorities, which are regularly criticized by international and regional NGOs. By the firmness of his decision, Justice marks the “red lines” not to cross. The social contract is based on a system of redistribution, particularly for disadvantaged populations of the northern Emirates: housing allocation, free access to care and education, aid for honeymooners, recruitment in the public sector (employer 97 UAE% of assets).

Economic situation

Second Gulf economy after Saudi Arabia, the State of the UAE, whose nominal GDP is estimated at $ 339 billion for 2015, is dominated by the Abu Dhabi Emirate (just over 60% of total GDP) . This provides the bulk of hydrocarbon production (over 90%) and manages virtually all savings accumulated in sovereign wealth funds (nearly 800 billion under management to $ ADIA, $ 55 billion to Mubadala ).

4th oil producer in OPEC (2.8 million barrels / day), in 7th place for the world’s reserves (98 billion barrels), the 17th largest gas producer (7th place for the reserves), the UAE, however, are managed to reduce dependence of the economy on oil through the development of a platform of services in the early 1980s (tourism, port and airport activities, re-export of goods accounting for 35% of total exports). Today, the oil sector accounts for just over 30% of GDP.

The Emirates are among the best armed Gulf countries to absorb the impact of falling oil prices. The advanced level of diversification in terms of regional standards, significant foreign exchange reserves, the relatively smaller level of subsidization of basic services, strengthening financial markets that are both Abu Dhabi and Dubai, the windfall that is lower courses for key sectors such as air transport (about 15 %% of the Federation of GDP) or heavy industry are as many safety nets that should save the UAE a major economic shock.

The problems since the end of 2008 the debt “Dubai Inc.” today can be considered manageable. The amount of the debt was stable in nominal terms for the first time since late 2009. In addition the recovery of the real estate market has mechanically improved the financial situation of some of the constituent entities of “Dubai Inc . “. Caution is needed, however, the rating agencies have not been able to assess in detail the financial resources and, consequently, the borrowing capacity of the

Emirate of Dubai, even that they were able to do without major problems, whether in Abu Dhabi, Sharjah and Ras Al Khaimah to.

Foreign policy

The diplomacy of the Federation of UAE, discreet and neutral long, adopt since the Arab revolts of 2011 a much more assertive posture, which rests on the armed forces in constant development.

It is primarily dictated by security considerations, facing two major threats perceived: the rise of radical Islamist currents and, in the background, Shiite expansionism.

The expansion of radical Islam is today the main concern of the Emirates. Political Islam is seen as incompatible with the social choices made for the development of the country: an open, welcoming and multicultural society. Political Islam is also considered the only political force capable of challenging the legitimacy of the ruling families.

In Egypt, Abu Dhabi has committed strongly to help the new government and is now one of the main donors (up to $ 9.5 billion since June 2013).

In Syria, the UAE call from Bashar al-Assad but fear a collapse of the regime in Damascus, who would sign the accession to power of extremist Islamic groups, hence their extreme caution.

The Shiite threat is now mostly seen on the Yemeni theater. The most active members of the military coalition in Yemen led by Saudi Arabia since March 23, the Emiratis have suffered a historic setback on September 4 when the attack on the military base Safer, who made more than fifty victims in the armed forces. The incident generated a burst of patriotism in the UAE, by growing the determination of Abu Dhabi authorities to take over the houthies militias.

A strong distrust characterizes the bilateral relationship with Iran, linked both to the dispute of the three islands of the Gulf (Abu Musa, Greater Tunb and Lesser) occupied by Iran since 1971 and, in general, fear of Iranian hegemony. The UAE remain deeply concerned about the growing power of Iran in the region, whether in Iraq, Syria or Yemen, which increases the sense of encirclement in the Gulf countries. They are also skeptical about the terms of the agreement reached with Iran on nuclear power, which they fear could strengthen the hand of Iran at the expense of Sunni Arabs. In the wake of the diplomatic relations between Saudi Arabia and Iran in January, the UAE recalled its ambassador posted in Tehran. They also reiterated their positions Ambassador to Lebanon, accused of being under the influence of Hezbollah.

To ensure their safety in a volatile region, the UAE have turned to Western partners, they wanted to diversify. The defense agreement with France (1995, strengthened in 2009) and the opening of our base in 2009 are emblematic of this strategy, we are a major partner. The UAE is also claim, and increasingly as a political and military credible actor. They have participated in recent years, the main military coalitions (Kosovo, Afghanistan, Libya) and today is an important player in the anti-Syrian coalition Daech and the Coalition, led by Saudi Arabia, Yemen. .

Regionally, the UAE shall ensure cohesion GCC display. This regional solidarity is also motivated by the defense of a common political model. The UAE, however, assume the specificity of their social model, far removed from the conservative positions of Saudi Arabia and even Qatar’s policy of support for Islamist movements. In March 2014, tension with Qatar were, unusually exposed in public, with the recall of ambassadors UAE, Saudi and Bahraini in Doha in March 2014. Kuwaiti mediation and Saudi, allowed a calming these voltages from 16 November. The visit of the Crown Prince of Abu Dhabi, Sheikh Mohammed Bin Zayed Al Nahyan, in Doha on 28 November 2014, has marked an improvement in relations between the two countries. The Summit of the GCC Supreme

Council, bringing together the heads of state of member countries, could take place on December 9, and mark the beginning of a year of Qatari presidency of the organization.

The main feature of the UAE’s prosperity and economic dynamism. Bilateral diplomatic relations primarily come in support of economic and trade relations, including the organization, on the sidelines of political visits, business forum. The strategy of the country, which has experienced over the past three decades, a phenomenal economic development inspired by the Singapore model is to establish itself as the “hub” of relations between Europe and Asia and the flat regional Platform for foreign companies operating in the Middle East. UAE diplomacy is part of this strategy, consolidating the reputation of the country, including by hosting international meetings, which positions the country as a place for exchange and dialogue. Their external action is to be part of globalization: the home of the World Expo 2020 in Dubai will mark in this respect a form of consecration

Tawfik EL GUEROINI

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