02 April 2017
Minister of Cabinet Affairs and the Future Mohamad El Gergawi and Mubadala CEO Khaldoon Khalifa Al Mubarak offer their views of what lies ahead for the United Arab Emirates over the next few decades.
The first challenge that may face the UAE over the next 50 years is the long-term decline of oil, not just in terms of reserves but in terms of price and how much it contributes to the economy, according to Simon Baptist, global chief economist at the Economist Intelligence Unit.
Among the major oil producing countries worldwide, the UAE comes at the forefront in terms of how it has successfully diversified its economy away from its focus on hydrocarbons.
“Our non-oil economy contributes 70 percent to the GDP and this is the highest in the region. Our economy is quite diversified,” Mohammad Abdulla Al Gergawi, Minister of Cabinet Affairs and the Future, UAE Ministry of Cabinet Affairs said at Global Manufacturing and Industrialisation Summit held at Abu Dhabi on Thursday.
“If you look at the tourism sector alone, we have over 20 million tourists, and that is almost double the country’s population of around 9 million people,” he added.
The UAE has long been preparing for the day when it either runs out of this natural resource, or its economic benefits are so severely affected, according to Khaldoon Khalifa Al Mubarak, chairman, Executive Affairs Authority of Abu Dhabi; managing director and group chief executive officer at Mubadala, the Abu Dhabi state-owned investment fund.
“I don’t even agree with the point that oil as a commodity would lose its intrinsic value in the short or even long term,” he added.
A second potential challenge would be the opening up of regional economies that might affect the UAE’s place as a hub in the region, according to Baptist, with countries like Saudi Arabia and Iran slowly emerging as rival economic powerhouses.
“I think that the opening of the regional markets is actually going to be good for us. If your neighbour is doing well, you’ll do better,” Al Gergawi noted.
“What worries me is not the opening up of regional economies, but the closing of some big economies globally: protectionism and the bigger scale change in the global arena,” he added.
Mubadala’s Al Mubarak sees the competitive environment changing all the time, but the distinguishing factor is the ability to stay competitive and ahead of the game.
“We in the UAE have the confidence that we will be ahead of the game because we don’t walk, we run, we sprint, and we will continue to sprint, and that is a message you will hear from leadership, from top executives and academics about the UAE.”
The third challenge for the UAE is related to climate change and whether it’ll be sustainable or pleasant from an outside perspective to live in the UAE if the temperatures rise 3 or 4 degrees 50 years from now.
The UAE has been advancing progressively at the fronts of alternative energy, environment, and technology to deal with the threat of global warming.
'We need to bear in mind that there is evolutionary technology even with heat. Today, you can walk outdoors and have a 5 percent cooler temperature than the usual through certain technology,’ Al Gergawi noted.
Al Mubarak sees that climate change is a challenge but he has full confidence that the UAE will tackle it. He elaborated on the country’s early investment in solar technologies when the concept was widely challenged for an oil producing nation along with the high production cost of 60 cents a kilowatt back then.
“Over the last 6 years, we have gone from 60 cents per kilowatt to be at the forefront of this technology and we are now building a solar plant in Dubai at the lowest cost per kilowatt in the world of 2 cents a kilowatt.”
Further reading:
© Express 2017
Minister of Cabinet Affairs and the Future Mohamad El Gergawi and Mubadala CEO Khaldoon Khalifa Al Mubarak offer their views of what lies ahead for the United Arab Emirates over the next few decades.
The first challenge that may face the UAE over the next 50 years is the long-term decline of oil, not just in terms of reserves but in terms of price and how much it contributes to the economy, according to Simon Baptist, global chief economist at the Economist Intelligence Unit.
Among the major oil producing countries worldwide, the UAE comes at the forefront in terms of how it has successfully diversified its economy away from its focus on hydrocarbons.
“Our non-oil economy contributes 70 percent to the GDP and this is the highest in the region. Our economy is quite diversified,” Mohammad Abdulla Al Gergawi, Minister of Cabinet Affairs and the Future, UAE Ministry of Cabinet Affairs said at Global Manufacturing and Industrialisation Summit held at Abu Dhabi on Thursday.
“If you look at the tourism sector alone, we have over 20 million tourists, and that is almost double the country’s population of around 9 million people,” he added.
The UAE has long been preparing for the day when it either runs out of this natural resource, or its economic benefits are so severely affected, according to Khaldoon Khalifa Al Mubarak, chairman, Executive Affairs Authority of Abu Dhabi; managing director and group chief executive officer at Mubadala, the Abu Dhabi state-owned investment fund.
“I don’t even agree with the point that oil as a commodity would lose its intrinsic value in the short or even long term,” he added.
A second potential challenge would be the opening up of regional economies that might affect the UAE’s place as a hub in the region, according to Baptist, with countries like Saudi Arabia and Iran slowly emerging as rival economic powerhouses.
“I think that the opening of the regional markets is actually going to be good for us. If your neighbour is doing well, you’ll do better,” Al Gergawi noted.
“What worries me is not the opening up of regional economies, but the closing of some big economies globally: protectionism and the bigger scale change in the global arena,” he added.
Mubadala’s Al Mubarak sees the competitive environment changing all the time, but the distinguishing factor is the ability to stay competitive and ahead of the game.
“We in the UAE have the confidence that we will be ahead of the game because we don’t walk, we run, we sprint, and we will continue to sprint, and that is a message you will hear from leadership, from top executives and academics about the UAE.”
The third challenge for the UAE is related to climate change and whether it’ll be sustainable or pleasant from an outside perspective to live in the UAE if the temperatures rise 3 or 4 degrees 50 years from now.
The UAE has been advancing progressively at the fronts of alternative energy, environment, and technology to deal with the threat of global warming.
'We need to bear in mind that there is evolutionary technology even with heat. Today, you can walk outdoors and have a 5 percent cooler temperature than the usual through certain technology,’ Al Gergawi noted.
Al Mubarak sees that climate change is a challenge but he has full confidence that the UAE will tackle it. He elaborated on the country’s early investment in solar technologies when the concept was widely challenged for an oil producing nation along with the high production cost of 60 cents a kilowatt back then.
“Over the last 6 years, we have gone from 60 cents per kilowatt to be at the forefront of this technology and we are now building a solar plant in Dubai at the lowest cost per kilowatt in the world of 2 cents a kilowatt.”
Further reading:
- UAE prepares for post oil era with diversification - Tawazun CEO
- UAE aims to attract $75 billion in manufacturing sector by 2025 - economy minister
- UAE's Annual Investment Meeting 2017 to focus on governments role in attracting investments, facilitating entrepreneurship and innovation
- Zawya Special Coverage: The transformation of Saudi Arabia & Vision 2030
© Express 2017
