An overview of the United Arab Emirates
The United Arab Emirates (UAE) was formed by the union of seven Emirates during which HH late Sheikh Zayed Bin Sultan Al Nahyan and HH late Sheik Rashid Bin Saeed Al Maktoum joined to form the union on December 2, 1971; Ending what was known the era of the Trucial states and announcing the UAE as a sovereign state. The UAE is governed by a president along with 6 rulers presiding over the governments of each emirate, known as the Rulers of the Supreme Council. Renowned for its economic progress, rapid development and a nation of state of art nation technology, the UAE has become a major business destination and the economic hub of the Middle East. This distinguished global position has been enhanced by an extraordinary secure business medium attracting foreign direct investment and an influx of foreign expatriates seeking employment opportunities from all parts of the world. As a result, the UAE population grew from a mere 1 million in 1971 to a figure exceeding the 9 million today and still growing.
A glimpse of the seven emirates comprising the UAE:
Abu Dhabi: The capital city of the UAE,Abu Dhabi, is at the fore of all seven emirates. It is the most prominent part of the UAE and considered to be the center of legislation, governmental decisions, and wealth. Based on its substantial oil reserves being the home-soil containing the 3rd largest global crude oil reserves, Abu Dhabi has provided the UAE with a leading position and status in the production of crude oil producer globally. As a member of the OPEC and OAPEC, the UAE oil quota is dependent mainly on oil extracted from Abu Dhabi onshore and offshore oilfields. This in itself gave Abu Dhabi a great significance not only on the UAE level but also regionally and internationally.
Dubai: The emirate of Dubai is yet another prominent destination in the UAE. Renowned for its development and growth, this emirate, often called the pearl of the Arabian Gulf, is known as the commercial center of the UAE.Unlike Abu Dhabi, where oil is the main industry, Dubai has excelled through practicing economics by the book, capitalizing on diversified industries such as construction, real estate, tourism, stock and commodities market, in addition to evolving light manufacturing industries. Dubai has also been home for substantial FDI where investors have been attracted to lucrative returns on investment, injecting funds from abroad into various industries. Foreign investments have been comforted by the safe haven economy and secure environment assuring investors the safety of their assets. As a result, the emirate grew rapidly over a short period of time and currently boasts one of the leading infrastructures in the region.
Dubai is also home for the biggest ports in the region represented by Port Rashid and the famous Jebel Ali Port. Moreover, free zone areas attract investors and manufacturers who take advantage of flexible licensing in free zones amalgamated with ease of shipping, import of raw material in addition to export and re-export of good through highly equipped ports.Although Dubai underwent a relative decline to its construction and property sectors due to the global financial crisis in 2008, the emirate’s economy remained intact, instigating a new infrastructure project fueled by heavy budget deficits (Heavy government spending). Government spending has kept employment levels high relative to other economies in the region withstanding the global crisis and keeping markets afloat. Consequently, retail markets, the tourism industry and other trade sectors remained optimistic.
Sharjah: The third largest emirate of the UAE in terms of area, Sharjah is considered as a highly inhabited emirate. The emirate is characterized by an enhanced infrastructure along with a large number of residential and commercial buildings. Sharjah is yet another retail hub where outlets are spread across the entire city. The emirate also boasts a touristic destination capitalizing on being located on both the Arabian Gulf and the Indian Ocean. Sharjah’s economy also depends on light manufacturing, crude oil byproducts and substantial deposits of natural gas. Foreign manufacturers have a large presence in the emirate capitalizing on the flexibility of business setup and abundance of skilled labor. The emirate thus possesses a large industrial sector where primary resources are converted to secondary and tertiary goods. This also includes a wide emphasis on recycling industries, processing and reprocessing metal scrap, paper and other recycling.
Ajman: Further north and extending from several routes from Sharjah, the emirate of Ajman is yet another coastal city overlooking the Arabian Gulf. Characterized by many historical sites, forts and old monuments, the city is an attraction to many tourists from all over the world. White sand beaches and signature branded hotels serve the tourism industry along with retailing throughout the northern city. Being on the Arabian Gulf, Ajman is also remarked for its shipping through its equipped port. In a similar fashion to Sharjah’s industrial capabilities, Ajman is industrially relatively smaller but still contributes to industrial outputs through light manufacturing, recycling and assemblies. The emirate has small oil deposits and thus depends on fund injections from the federal government to fuel its infrastructure spending and provision of public goods. The emirate has a great potential in terms of tourism based on its ideal beaches and safety. Many investors have injected funds into the emirate through setting up hospitality firms, cuisine and entertainment.
Umm-al- Qaywayn: Is a purely touristic destination with clean beaches overlooking the Arabian Gulf.Although Umm-al-Qaywayn is amongst the smallest of the seven emirates, its economy survives on the hospitality sector, tourism and retail markets. The emirate relies on large subsidies provided by the federal government. Like the remaining Emirates, the ideal geographical location overlooking the Arabian Gulf, Um Al Qaywain is yet another logistic hub where its port plays roles in shipping, importing, exporting and re-exports.Considering its small oil reserves, its primary source of revenue is generated from light manufacturing stemming from its cement industry and other small assemblies.
Ras-al-Khaymah: At the extreme north, Ras-al- Khaimah is considered the most industrialized emirate in the UAE. The emirate is a major producer of cement, ceramic and other highly specialized material required by the UAE construction sector and other sectors within the GCC. The emirate topography is a mix of coasts and mountains extending to and bordering neighboring the Sultanate of Oman.
From a purely economic point of view, the emirate attracts FDIs through its potential and relatively lower set up costs. RAK free zone authority has made the investment process into the emirate an ultimately easy process where multinationals have settled in a harmonized business medium and contributed to the growing infrastructure of the city. Characterized by inexpensive labor costs, Ras Al Khaimah has lowered manufacturing costs attracting producers to shift towards building plants in the emirate. The emirate is also positioned strategically on the Arabian Gulf with ports characterized by deep waters necessary for giant oil tankers and container liners to move swiftly in and out the ports of the emirate. Low customs and duties have contributed to the imports, exports and re-exports from and to the whole world.
Ras Al-Khaimah is also home to historical sites and forts that can be seen sporadically spread throughout the emirate close to beaches. White beaches on the other hand, amalgamated with super hospitality chains and hotels, are ideal destinations for tourists from all over the world.
As part of a fairly secure UAE environment, Ras Al-Khaimah enjoys a safe haven surrounding characterized by a strong police force and security
Fujairah: With coasts located along the Gulf of Oman and the Indian Ocean,Fujairah is characterized by ample beaches lying adjacent to rocky mountains. Seas are dominated by deep waters allowing the emirate to boast significant ports in a region where giant oil tankers and container liners enter and exit to the rest of the world. The emirate witnesses relatively high rainfall, allowing farms to grow domestically consumed vegetables and fruits.
In addition to the shipping sector, Fujairah depends on its tourism sector as well, capitalizing on its white clean beaches and renowned hotels scattered on its beaches. Touristic destinations include the famous Khor Fakan on the Indian Ocean, which is a preferred destination for Scuba divers, snorkelers and sea-sports enthusiasts.
Although a relatively small emirate, Fujairah, being home for ports where oil tankers depart to the rest of world, engages in refining oil into partial byproducts. The emirate’s economy also depends highly on subsidies from the federal government.