Dubai’s economy has a gross domestic output of US$102.67 billion as of 2018. The construction boom was curtailed by the Great Recession.
It’s been described as “centrally-planned free-market capitalism” by the International Herald Tribune. Oil production, which once contributed for half of Dubai’s gross domestic product, now accounts for less than 1%. Wholesale and retail commerce accounted for 26% of total GDP in 2018, while transportation and logistics accounted for 12%, banking, insurance activities, and capital markets accounted for 10%, manufacturing accounted for 9%, real estate 7%, construction 6%, and tourism 5%.
For Western manufacturers, Dubai has become an important port of call. The port region was home to the majority of the new city’s banking and financial centers. Throughout the 1970s and 1980s, Dubai remained a vital trading route. Dubai has unrestricted gold commerce and was the center of a “brisk smuggling trade” of gold ingots to India, where gold imports were prohibited, until the 1990s.
Dubai’s economy is now centered on tourism, with hotels being built and real estate being developed. Port Jebel Ali, built in the 1970s, boasts the world’s largest man-made harbor, but it’s also becoming a centre for service industries like IT and banking, thanks to the new Dubai International Financial Centre (DIFC). Emirates Airline, situated at Dubai International Airport, was formed by the government in 1985 and is still state-owned; in 2015, it carried over 49.7 million passengers.
Dubai is the #1 business gateway for the Middle East and Africa, according to Healy Consultants. In order to develop Dubai property, the government has established industry-specific free zones throughout the city. Dubai Internet City, which is now part of TECOM (Dubai Technology, Electronic Commerce and Media Free Zone Authority), is one of these enclaves, with members including EMC Corporation, Oracle Corporation, Microsoft, Sage Software, and IBM, as well as media companies like MBC, CNN, Reuters, and the Associated Press. Dubai Knowledge Village (KV), an education and training hub, has been established to support the Free Zone’s other two clusters, Dubai Internet City and Dubai Media City, by offering facilities to train the clusters’ future knowledge workers. Companies engaged in outsourcing activities can set up offices in the Dubai Outsourcing Zone, which offers concessions from the Dubai government. In most parts of Dubai, internet access is restricted, with a proxy server screening out sites that are believed to be against the UAE’s cultural and religious values.
What percentage of the UAE’s GDP is accounted for by oil?
The UAE boasts one of the world’s most open economies. This legacy of inviting business and trade dates back to the early Gulf era, when ships travelled to India and as far south as Mozambique along the East African coast.
With business-friendly free zones and a rapidly rising economy, the UAE remains a strategic hub. In 2019, the UAE’s GDP was $421 billion. This reflects the UAE’s abundant natural resources, which account for 10% of global oil reserves and the world’s fifth-largest natural gas reserves.
Oil exports have been a foundation of the UAE economy, accounting for over 30% of total GDP. In addition to being a significant energy exporter, the UAE is increasingly becoming a significant energy consumer. As it develops and diversifies its economy, accelerates the exploration of additional hydrocarbon reserves, and contributes to the development and deployment of alternative energy sources, the UAE will maintain its long legacy of responsible energy management.
What is the composition of UAE GDP?
Manufacturing (12.6 percent), commerce and hotels (11.4 percent), real estate (9.1 percent), construction (8.6 percent), and transportation (7.3 percent) are among the non-oil industries that have grown in importance during the past two decades as part of the UAE’s economic diversification policy.
Is the UAE’s economy reliant on oil?
With a gross domestic product (GDP) of US$421 billion (AED 1.5 trillion) in 2020, the United Arab Emirates (or UAE) is the fifth largest economy in the Middle East (after Turkey, Saudi Arabia, Egypt, and Iran).
The UAE economy, particularly in Abu Dhabi, is primarily reliant on petroleum and natural gas income. Oil exports accounted for more than 85% of the UAE’s economy in 2009. Oil exports accounted for 77% of the UAE’s governmental budget in 2011. Economic diversification has occurred in recent years, particularly in Dubai. In terms of diversification, Abu Dhabi and other UAE emirates have taken a cautious approach. Dubai’s oil reserves are significantly lower than those of its neighbors.
Tourism is one of the UAE’s most important non-oil revenue sources. The UAE’s economy is diversifying thanks to a large construction boom, an expanded manufacturing base, and a strong services sector. There are now $350 billion worth of ongoing construction projects across the country.
Why is the United Arab Emirates the richest country?
With a GDP per capita of $57,744, the UAE is the world’s third richest country, after Luxembourg at number two and Qatar at number one. The production of items and provision of services connected to petroleum, petrochemicals, aluminum, and cement account for the majority of its revenue.
How did the UAE discover oil?
The first oil company teams conducted geological investigations in the UAE in the early 1930s. The first cargo of crude oil was shipped from Abu Dhabi thirty years later, in 1962. In 1966, HH Sheikh Zayed bin Sultan Al Nahyan was elected Ruler of Abu Dhabi, with the economy slowly improving. The continuous oil earnings under Sheikh Zayed resulted in an infrastructural upgrade, with schools, houses, hospitals, and roads being built throughout Abu Dhabi.
Sheikh Zayed took a number of early steps, including increasing contributions to the Trucial States Development Fund, with Abu Dhabi being the fund’s largest donor. Meanwhile, HH Sheikh Rashid bin Saeed Al Maktoum, Dubai’s de facto ruler since 1939, diversified his income by joining the maritime industry. Sheikh Rashid concentrated his attention in 1969, when the Emirate of Dubai began exporting oil, on implementing initiatives aimed at enhancing the quality of life of his people with the new oil funds. When the British announced their withdrawal from the Arabian Gulf in 1968, Sheikh Zayed acted rapidly to forge tighter connections between the Emirates. Sheikh Zayed argued for a federation that would include not just the seven Emirates that make up the Trucial States, but also Qatar and Bahrain, including Sheikh Rashid.
On December 2, 1971, an agreement was made between the rulers of six Emirates (Abu Dhabi, Dubai, Sharjah, Umm al-Quwain, Fujairah, and Ajman), and the United Arab Emirates was formally founded. The following year, the seventh Emirate, Ra’s al-Khaimah, joined the new federation. Qatar and Bahrain were created as two different countries.
The seven Emirates have developed a distinct national character since the union’s inception. By integrating history with a modern administrative structure, the UAE’s political system ensures that the country’s heritage is protected, updated, and safeguarded.
How much oil does the UAE have left?
As of 2016, the United Arab Emirates ranked seventh in the world with 97,800,000,000 barrels of proved oil reserves, accounting for around 5.9% of the world’s total oil reserves of 1,650,585,140,000 barrels.
The UAE possesses proven reserves that are equivalent to 299.0 times its yearly use. This suggests that there would be around 299 years of oil left if Net Exports did not exist (at current consumption levels and excluding unproven reserves).
How much oil does Dubai possess?
- Dubai begins to export oil in 1969. Around 180 thousand barrels of oil were exported from the Fateh field in the first shipment.
- In the Falah field, oil drilling exploratory wells begin operations in 1972. June 1978 marks the start of production.
- Rashid discovers a new oil well in 1973, and production begins in March 1979.
- Margham’s second oil field was discovered in 1982, and production began in 1984.
- 1999: The Emirates National Oil Company (ENOC), a wholly owned subsidiary of the Dubai government, launches its first oil refinery. The refinery, which cost roughly Dh1.5 billion and produces 120 thousand barrels per day, is one of the most expensive in the UAE.
- Dubai joins the Dolphin project in 2000, signing a memorandum of understanding to supply Qatari gas to the Dubai Supply Authority through the project (Dolphin)
- 2007: Following discussions with foreign oil firms, Dubai Petroleum takes ownership of all oil and gas related projects in Dubai.
Dubai has around 4 billion barrels of oil in reserve and is the UAE’s second largest oil producer. The largest operator in the emirate is Dubai Petroleum Co (DPC). Dubai’s oil output peaked at 410,000 barrels per day in 1991 and has been progressively dropping since then.
Dubai’s oil reserves have declined over the last decade and are anticipated to run out in the next 20 years. Fateh, Southwest Fateh, with two lesser fields, Falah and Rashid, are the primary fields offshore. The Margham field is the sole onshore deposit. The main operator is Dubai Petroleum Company (DPC).
Condensate production from the onshore Margham field is roughly 25,000 barrels per day. Margham is now run by the Dubai Margham Establishment, which is completely owned by the Dubai government. It was previously operated by Arco International Oil and Gas Company.
Dubai’s government owns the National Oil Company (ENOC), which is in charge of the city’s oil activities. EPCO is affiliated with ENOC, which distributes petroleum products to more than 125 distribution stations throughout Dubai and the Northern Emirates.
What is the UAE’s global ranking?
In the 2018 Global Knowledge Index, the UAE is ranked first in the Arab world and eleventh overall. The UAE was rated 11th internationally and first in the Arab World in the fifth edition of the Global Knowledge Index leaders for 2021, which was released on Monday.