UAE achieves more prosperity for nation, citizens

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UAE achieves more prosperity for nation, citizens

On December 2, 2012, the United Arab Emirates marks its National Day, celebrating 41 years since the state was established in 1971. For citizens and expatriate residents of the seven component emirates of the federation, Abu Dhabi, Dubai, Sharjah, Ras Al Khaimah, Ajman, Umm Al Qaiwain and Fujairah, it has been a year during which the country has continued to thrive and prosper, despite the economic crises that have affected much of the rest of the world and the political turmoil that has continued to engulf much of the Middle East region.

By (Wam)

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Published: Thu 29 Nov 2012, 12:28 PM

Last updated: Tue 7 Apr 2015, 1:30 PM

The road to the UnionLocated in the south-east corner of the Arabian peninsula, with coastlines both on the Arabian Gulf and on the Gulf of Oman, the seven emirates, formerly known as the ‘Trucial States’, came together following the withdrawal of Britain after 150 years. Led by the UAE’s founding father, the late Shaikh Zayed bin Sultan Al Nahyan, the seven rulers decided to form a federation, to work together to bring prosperity and development to their people. Aided by the vision of Shaikh Zayed, the UAE has since emerged as one of the fastest-growing and most stable countries in the region.

Shaikh Zayed himself died in 2004, after over thirty years as President. The process of growth, however, has continued under the leadership of his son and successor as President, His Highness Shaikh Khalifa bin Zayed Al Nahyan, His Highness Shaikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, their fellow members of the UAE’s Supreme Council of Rulers and the Crown Prince of Abu Dhabi and Deputy Supreme Commander of the UAE Armed Forces, His Highness Shaikh Mohammed bin Zayed Al Nahyan. Despite the continuing problems faced by the global economy over the last few years, the UAE, thanks to its wise economic policies, has continued to develop successfully, with further growth confidently predicted for the years ahead.

In a speech to the Federal National Council, (Parliament), at the beginning of November, President His Highness Shaikh Khalifa emphasised the Government’s commitment to uphold the country’s constitution and the rights and freedoms for citizens and other residents.

This, he said, had helped to make the UAE “a paradise for citizens and others. All live in peace in a tolerant community that is free from segregation and injustice.”

This applied, he said, both to men and women, thanks to a firm government policy that women should be given all necessary support to allow them to display their ability and responsibility. As a result, he noted, many now occupy leading positions,

Today, women account for around 70 per cent of all university graduates in the country and fill around two thirds of government jobs, providing four members of the Cabinet, several FNC members, ambassadors and even air force pilots, evidence of the country’s success in empowering its women.

Urging Council members to play their role as “a supportive and control authority to further strengthen the Government with its vision and innovative ideas,” the President went on to pledge continued change, within the framework of the country’s traditions and norms, to develop the scope for greater popular participation.

Noting that the role of the FNC had already developed since the launching of a gradualist programme of political empowerment in 2005, particularly since the holding of a second round of elections for the Council’s members in 2011, the President told the FNC: “Your membership in this Council is a great trust and responsibility. Governance here belongs to those who have bestowed their trust on you” (the electors). “So be solicitous to maintain your eligibility to have received this trust and be committed to the interests of the country and the citizens.”

Members must work, he said, to protect the bonds that link all segments of UAE society, “in our quest to entrench the culture of consultation and participation in decision-making, as well as to emphasise the importance of individual opinions in formulating the opinion of the society.”

The guiding principles that underlie the success of the state, originally laid down over forty years ago, remain fundamental elements in the policies of the UAE’s Government. One was that the resources deriving from the exploitation of Abu Dhabi’s oil and gas reserves should be shared across the country in the development of its infrastructure. A second was that, as Shaikh Zayed put it, ‘the country’s real wealth is its people’, and that, in consequence, particular effort should be made to ensure that they should benefit from the best available access to education, health care and social services, to equip them, both men and women, to play their full part in the country’s growth.

Highway to Dubai’s destinyA third principle, in recognition of the fact that the UAE was a country that would attract people of many nationalities, was that it should be a country where a spirit of tolerance between those of different communities and faiths should prevail, yet one where its own national culture and heritage should be both cherished and protected. Although firmly committed to the Islamic faith of its citizens, the UAE is now home to over 40 churches and cathedrals as well as to places of worship for other faiths.

And the fourth principle, looking outside the country, was that the UAE was to seek to promote dialogue, co-operation and the resolution of conflicts, both within the Arab world and the broader Islamic community and within the wider international community.

All have proved to be of importance over the course of the last year.

In terms of the UAE economy, although signs of recovery from the crisis that began in 2008 began to become apparent during 2011, the real effect of the turn-around has become clearly visible during 2012 in all key sectors of the economy. Trade, aviation, tourism and retail sectors have seen substantial growth, along with the oil and gas industry, benefiting from high international prices. Figures from the Federal Customs Authority indicate that during the first six months of 2012, the country’s non-oil foreign trade grew by 10 per cent over the equivalent 2011 figures to Dh 499 billion (US $ 135.9 billion). Despite the impact of international sanctions on one of the country’s main trading partners, Iran, exports and re-exports grew by 40 per cent over the same period, to Dh 77 billion (US $ 20.95 billion), while imports grew by 12 per cent to Dh 321.4 billion (US $ 87.5 billion).

Overall, according to the Economy Minister, Sultan Al Mansouri, speaking in early November, the UAE’s economy is expected to grow by between 3.5 to 4.0 per cent during 2012, compared to growth of around 4.2 per cent in 2011, an impressive achievement at a time of growing difficulties for the global economy. During 2011, the UAE booked a consolidated budget surplus of Dh 36.2 billion, or US $ 9.85 billion, 2.9 per cent of nominal Gross Domestic Product of Dh 1.32 trillion (US $ 359 billion).

Dubai’s venerable timekeeperThe latest updates from the country’s three main airports, Abu Dhabi, Dubai and Sharjah, have all reported double-digit growth in passenger figures and the UAE’s busiest airport, Dubai, is expected to record well over 50 million passengers during the course of the year, on its way over the course of the next few years to becoming the busiest airport in the world. The growth is broadly in line with that of the three UAE national carriers, Emirates, in Dubai, whose profits rose by 20 per cent in the first half of 2012, Etihad, in Abu Dhabi, and Air Arabia, in Sharjah. Air Arabia’s turnover for the first nine months of 2012 was up by 126 per cent over the same period in 2011, an indication of the way in which the airline, the first and largest low-cost carrier in the region, is demonstrating the success of its business model. At a time of crisis for the global aviation industry, it’s an indication of the strength of the sector in the UAE that all three carriers are now profitable. Emirates, the largest, now flies to nearly 130 destinations, in 74 countries, and has one of the largest networks in the world.

Elsewhere in the transport sector, the biggest event of the year has been the formal opening of Abu Dhabi’s new Khalifa Port at Taweelah, between the capital and Dubai, now set to become the country’s second largest economic gateway after the Jebel Ali Free Zone, which continues its own growth with nearly 7,000 companies now registered there. Nearby Dubai World Central, Dubai’s new airport, which covers an area of around 140 sq. km., will be the world’s largest when completed.

A selection of other statistics provides a further indication of the country’s growth. During the first half of 2012, for example, Abu Dhabi hotels reported a 15 per cent growth in guests, to 1.74 million, while in Dubai guest numbers rose by ten per cent to 5.02 million and hotel revenues rose by a remarkable 22 per cent to Dh 9.79 billion (US $ 2.66 billion). Inflation meanwhile has remained low, according to International Monetary Figures, at around 0.9 per cent, mainly due to a continuing decline in house rental costs.

Even the real estate sector, hardest-hit by the 2008 economic downturn, has revived during the year. The worst victim of that crisis, Nakheel, reported a 97 per cent increase in profits during the first nine months of 2012, with a 126 per cent jump in revenues, an indication of a revival in the appetite of investors for high quality residential property.

The growth in the country’s economy, at all levels, has, of course, been supported by the ease of doing business in the UAE, which was ranked as the top country in the Middle East region in the 2011-2012 Global Competiveness Report.

A ticket to rideGovernment expenditure, a key driver of growth, has continued to focus on investment in the national infrastructure and on social, health and educational services, as part of a three-year plan, launched in 2011, to improve facilities for the country’s citizens and for expatriate residents. Overall, the plan involves spending of around 133 billion UAE dirhams, (US $ 36.2 billion). For 2012, a budget of Dh 41.4 billion (US $ 11.3 billion) was approved, while for 2013, expenditure will rise by 6.69 per cent to Dh 44.6 billion (US $ 12.14 billion). Announcing next year’s budget, the UAE’s Vice President and Prime Minister, His Highness Shaikh Mohammed bin Rashid Al Maktoum, who is also the Ruler of Dubai, noted: “Priorities for the 2013 (federal) budget will be health, education and social benefits for citizens as well as the improvement of government services.”

The social sector will receive Dh 22.7 billion (US $ 6.17 billion) or 51 per cent of the total, with education accounting for Dh 9.9 billion (US $ 2.69 billion), or 22 per cent. This represents, however, only around 11 per cent of total government expenditure, with the remaining 89 per cent being spent by the individual emirates. Consolidated figures for both federal and local government expenditure amount to just over Dh 400 billion, or US $ 109 billion, a remarkably high sum for a country with an estimated population of only around 8.4 million people.

Bur Dubai enthralsOutside the framework of the formal budgets, further steps have also been taken to help UAE citizens. One way in which this is being done is through what has become known as the ‘Shaikh Khalifa Initiative’, a broad collection of activities, supported directly by the President. Among these are a programme under which thousands of citizens who lack their own homes have been given houses and a debt-relief programme under which some debts owed to banks have been cancelled. The Debt Settlement Fund, established by the President and administered by the Ministry of Presidential Affairs, has so far signed agreements with nearly 20 UAE banks, both local and foreign-owned, on the creation of a mechanism for the payment of loans on which recipients have defaulted. Coupled with this, instructions have been given for the release of Emirati citizens who have been jailed for giving cheques to banks as security for loans where the cheques have subsequently not been honoured. In the first three weeks after the instructions were given, in late October, nearly 300 people were released in Abu Dhabi alone.

Another step, important for both citizens and expatriates in the emirate of Abu Dhabi, has been the extension, announced in November, of a cap on rent increases, which cannot exceed five per cent for the renewal of contracts. First introduced in 2006, the rent cap has proved to be a powerful tool for limiting inflation and for promoting stability in the residential property market, with this now being further encouraged by a rapidly-increasing supply of new housing coming on to the market.

Reaching for the skyWhile sectors such as construction, real estate, tourism, trade and services continue to represent a growing share of the UAE’s GDP, the country’s oil and gas industry remains, of course, of enormous importance, thanks to the presence of the fourth largest oil and fifth largest gas reserves in the world. Most of those are found in Abu Dhabi, both offshore and onshore. During the year, the 50th anniversary of first oil production, from the offshore Umm Shaif field, was celebrated. By mid-2012, thanks to a heavy programme of investment in the last few years, Abu Dhabi’s daily oil production had reached 2.8 million barrels a day, and a targeted production of 3 million bpd has been set for the end of the year.

A further increase is due over the next few years, with around US $ 60 billion due to be invested in field development by 2017 to raise installed production capacity to 3.5 million barrels a day. While much of this increase is expected to come from existing fields, thanks to the introduction of the latest enhanced oil recovery, EOR, techniques, new fields will also contribute their share.

Unlike many other members of the Organisation of Petroleum Exporting Countries, OPEC, the UAE oil industry has a structure that allows for foreign joint venture partners and, during the year, a new entrant into the industry appeared, the Korean National Oil Company, which was awarded a concession covering an estimated 570 million barrels of reserves. Many other foreign companies, from Russia to China and from India to Ireland, are hoping that they too will be given the opportunity to enter into what is still a highly-challenging, but also highly-rewarding market.

From the rampartsThe economic and social progress achieved by the United Arab Emirates since it was established, coupled with the tolerance that characterises its way of life has meant that Government has traditionally enjoyed overwhelming support from all of the country’s residents, citizens and expatriates alike. That has continued to be displayed, with the UAE continuing to enjoy enviable stability at a time when much of the region is in turmoil.

In an article published in the London ‘Times’ in early November, Minister of State for Foreign Affairs Dr. Anwar Gargash made a strong defence of the UAE’s commitment to tolerance, something which, he emphasised, was an essential part of the country’s values and beliefs – “ intangible, unquantifiable but critical for stability and progress.”

“Most important of all is a respect for people’s freedom to live life as they wish: in short, tolerance. Cultures that defend tolerance have a strong sense of what should not be tolerated: namely, those who preach that people should be persecuted because of their beliefs.”

While continuing to support the principles of freedom of beliefs and of expression that are guaranteed under the country’s Constitution, the Government has been obliged over the last year to take action against a small group of individuals linked to the international Muslim Brotherhood who have sought to challenge the country’s tolerant approach.

Cruising alongWhile the group presents itself internationally, in English, as arguing for human rights and reforms of the political system, Dr. Gargash noted in his article in ‘The Times’, “in Arabic it reveals its true agenda driving religious minorities from the Arabian Peninsula, shutting churches and temples, reversing women’s rights and introducing its own interpretation of Islamic law. Far from defending human rights, it wants to trample all over them. “

“Such intolerance does not merely grate with Emirati culture; it threatens to undermine it,” Dr. Gargash said.

Foreign Minister His Highness Shaikh Abdullah bin Zayed Al Nahyan, returned to the theme, albeit from a more global standpoint, during his September address to the United Nations General Assembly.

“The United Arab Emirates has been and will remain committed to moderation in its approach, and accepts other communities as part of a diverse world built on mutual respect. It is these human values which have informed our convictions with regard to many issues such as counterterrorism, human rights, the empowerment of women, and coexistence among peoples and communities.”

Municipality par excellence“The United Arab Emirates emphasises the importance of consolidating the values of tolerance, moderation, and respect for religions, as well as the importance of protecting religions against defamation and contempt, and stresses the need to develop necessary legislation in this regard.”

One recognition of the country’s human rights record was its election, in November, as a member of the UN Human Rights Council. Of the 18 countries elected, the UAE received the second highest number of votes from the UN’s member countries.

The win, Dr. Gargash commented, “was a fruit of a series of achievements made by the UAE in its human rights record over recent years, particularly in areas of legislations to uphold and protect fundamental freedoms and legal rights of individuals, rights of women and children and advanced regulations on rights of foreign workforce.”

The issue of human rights generally, and of rights in the workplace was also addressed in October by the Minister of Labour Saqr Ghobash. The issue, he noted, “is closely monitored by the leadership to preserve human rights and dignity in conformity with the UAE values and national legislation applied to citizens and residents without discrimination. Hence, the UAE has become a magnet for different nationalities.”

More than just a squareRecent initiatives to protect the labour force, he noted, had been praised by bodies like the International Labour Organisation, like the Wage Protection System, WPS, introduced by the Labour Ministry to ensure that workers receive their salaries without delay.

Another recent innovation has been the introduction of changes to make it easier for workers to change jobs while the labour courts provide an arena in which workers can raise complaints against their employers if efforts to achieve an amicable agreement are unsuccessful.

Another important and continuing initiative from the Ministry of Labour has been the introduction of a package of policies designed to help labour-exporting countries protect their citizens against any exploitation and illegal recruitment practices at home, prior to their arrival in the Emirates.

These have built upon measures agreed during a 2008 Consultation on Overseas Employment and Contractual Labour for Countries of Origin and Destination in Asia, held in Abu Dhabi. This involved the working out of a comprehensive approach to managing the entire cycle of temporary contractual work that benefits both countries of origin and destination.

Sky highThe cycle comprises a broad range of protection measures covering both pre- and post-departure needs of workers, beginning in the country of origin (for instance, by shielding workers from illegal recruiters), continues after arrival in the country of destination (for instance, through measures curbing abuse and non-payment of wages), and on return and reintegration back home.

While there has, naturally, been a focus by Government on the continued improvement of social services and on the expansion of those sectors of the economy which will make the greatest contribution to the creation of employment for young Emiratis, both men and women, the need to focus on other areas of national life has not been overlooked. Work continued during the year on plans for the development of the Shaikh Zayed National Museum of the island of Sa’adiyat, adjacent to Abu Dhabi city. One of several major museums, including a Louvre and a Guggenheim, being planned, it will form the centrepiece of a new cultural complex that is expected to attract visitors in their thousands from overseas. Attention has also continued to be paid to the protection of the UAE’s fragile environment, this, together with cultural heritage, being considered to be important components of the country’s national identity.

A global iconIn the field of foreign affairs, the Middle East and North Africa region has, for a second successive year, been affected by political turmoil. In some countries, such as Egypt, Libya and Tunisia, new governments have emerged that are seeking to meet the major economic and other challenges that face them. Most worrying, however, has been the continued escalation of violence in Syria, where conflict between the Government and its opponents has produced an estimated death toll of over 50,000 people, with up to half a million now having fled into neighbouring countries for refuge and perhaps as many at 2 million more internally displaced. In early November, in association with its fellow members of the Gulf Co-operation Council, the UAE recognised a broad coalition of opposition forces as the legitimate representatives of the people of Syria.

In his speech to the United Nations General Assembly in September, Foreign Minister Shaikh Abdullah bin Zayed Al Nahyan noted: “What is happening in Syria is heartbreaking, and exceeds all limits and humanitarian norms. The United Arab Emirates is following the events in Syria closely, with deep concern at the escalating acts of violence perpetrated by the Syrian regime against its people, which have stripped the regime of its legitimacy. From this platform, we call upon the international community to soberly consider what is happening to our brothers in Syria, and to shoulder its humanitarian and political responsibilities to stop the heinous tragedies committed against the innocent people of Syria. We are convinced that the solution to this crisis will only be achieved through an orderly transition of power.”

He went on to pledge that the UAE would continue to provide continuing support for relief operations for the refugees affected by what he described as “this severe humanitiarian crisis.”

At the same time, the UAE continues to believe that one fundamental obstacle to the achievement of peace and stability in the Middle East region is the continuing failure to resolve the Arab-Israeli conflict.

Culture CapitalThis, Shaikh Abdullah told the United Nations, “is the central and vital issue to the people of the entire region, and reaching a just solution is the key for bringing peace and stability to the whole region. This cannot be realised without putting an end to the Israeli occupation of the Palestinian and Arab territories through Israel’s withdrawal to the lines of the 4th of June 1967, including from East Jerusalem, the occupied Syrian Golan Heights, and the remaining occupied Lebanese territories, and through achievement of a just and comprehensive peace in accordance with resolutions of international legitimacy, the principle of land for peace, the Arab Peace Initiative, and the establishment of an independent Palestinian state with East Jerusalem as its capital.”

The pursuit of security and stability in the Arabian Gulf region occupies, of course a high priority in terms of the UAE’s foreign policy, which derives its principles from the UN Charter and the provisions of international law, in particular those calling for peaceful coexistence, confidence-building, good neighbourliness, mutual respect, non-interference in the internal affairs of sovereign states, and resolving conflicts and disputes through peaceful means.

In that context, the Foreign Minister told the UN General Assembly, “My Government expresses, once again, its regret regarding the continued Iranian occupation of our three islands: Abu Musa, and the Greater and Lesser Tunbs, and demands the restoration of the UAE’s full sovereignty over these islands. We emphasise that all actions and measures taken by the occupying Iranian authorities are illegitimate, and are contrary to international law and to universal norms and values...We call upon the international community to urge Iran to respond to the repeated peaceful, sincere calls of the United Arab Emirates for a just settlement of this issue, either through direct, serious negotiations or by referral to the International Court of Justice to settle this dispute in accordance with the principles of the Charter of the United Nations and the provisions of international law.”

Further afield,the UAE has continued to support efforts to promote security and stability in Afghanistan, both through its contribution to the International Security Assistance Force, ISAF, and through humanitarian and development assistance. As 2014 approaches, when the international forces are due to withdraw, the UAE looks forward “ to closer international cooperation to ensure a future free of violence, extremism, and terrorism for Afghanistan,” Shaikh Abdullah said in his UN speech.

More generally, the UAE has continued its firm commitment to the international drive to eradicate terrorism, as well as the interlinked phenomena of illicit trafficking in drugs and arms and organised crime, As part of this, a new Centre of Excellence for Countering Violent Extremism has been established in Abu Dhabi, with the support of a number of friendly nations and other actors. It is due to commence its work at the end of 2012.

“Terrorism poses a challenge to international peace and security and leads to violating the human rights of ordinary people by depriving them of living in peace and prosperity,” Shaikh Abdullah told the United Nations. “In this context, and based on our commitment to the principles of human rights, we renew the support of the United Arab Emirates for international efforts aimed at ensuring peace, security, and prosperity for all the peoples of the world, and look forward to expanding our engagement in this area.”

A more wide-ranging issue, yet one of great importance for the global community, is that of nuclear proliferation. The UAE reaffirmed during the year its support for efforts aimed at making the Middle East region, including the Gulf, a zone free from weapons of mass destruction, with the Foreign Minister renewing a demand in his UN General Assembly speech for Israel to join the Nuclear Non-Proliferation Treaty and to allow inspection of its nuclear facilities.

He went on to urge Iran “to fully cooperate with the International Atomic Energy Agency (IAEA) and implement its international commitments, in order to dispel all fears and suspicions surrounding its nuclear program. We look forward to a peaceful solution to this crisis that ensures the elimination of tension and crises from our region, guarantees the transparency of Iran’s nuclear program, and confirms its peaceful nature.”

The UAE, he noted, had launched its own nuclear energy programme for peaceful uses in 2009, based upon the appropriate international safeguards related to transparency and technology. Other states within the region, he suggested, should draw on the UAE’s own experiences in this field.

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