Economy of United Arab Emirates

Data:

KEY ECONOMIC DATA	2006	2007	2008	2009	2010
GDP (current or constant USD billions)	164.0	200.5	272.7	216.6	234.3
GDP per capita (USD)	38800	44800	57200	46400	49900
GDP growth (% year)	1.7%	2.3%	5.3%	-3.2%	3.2%
STRUCTURE OF THE ECONOMY	Most recent data available
% of the GDP	20.8%
Agriculture	2
Industry / Manufacturing	14%
Services	45.6
Consumption expenditure	195111509998
Government expenditure	25.07
Net exports	AED1034323.00
Investments	18.66
PRICES	2006	2007	2008	2009	2010
Consumer Prices (CPI Index)	-	-	114.5	113.9	114.7
Inflation (CPI) %	9.3%	11.1%	12.3%	1.6%	1.0%
SOCIAL INDICATORS	Most recent data available
Population (millions)	5.4
Labor Force (% of population)	77%
Unemployment rate (% of Labor Force)	4.6%
Life expectancy (years)	76.51
Infant Mortality (per 1,000 live births)	15 male  13 Female
Literacy (% of population age 15+)	91
Human Development Index	0.845

UAE GDP Break down:

 

Human Development Index: Trends 1980 - present

In world rankings according to the United Nations Development programme, United Arab Emirates is ranked 32^nd in human development index. The quality of such indicators including health, education and income has been constantly increasing over the last several years. The percentage of literacy which is at 91% and still increasing is an indication that the standards of living in this nation are improving. The health sector has also improved and currently as in the table above the average life expectancy in United Arab Emirates is 76.51 years on average but highest in females at 79.22. Over the years there has been an increase in the number of economically active men and women with the value in 2009 standing at 77%. The value for men was twice as high as that of women, most of this population is between the ages of15 -59 such indicators coupled with an ever increasing GDP are the indication that the standards of living in UAE are better than most countries of the world and are still improving

Economic growth:-

Given the values of gross domestic product and the percentage change between 2006 and 2010, it is notable that the economy of the United Arab Emirates has been growing. The largest contributor to this GDP is the oil industry. The oil is mainly exported to other Arab nations. Other indices of economic development have also shown the same trend. Unemployment rate for example is bellow 5% which is remarkable if compared to all other countries in the world. Some of the major factors that have dealt the economic development a great blow is the fluctuation of the prices of oil and the low rate of tertiary education . Despite the fact that the literacy level in United Arab Emirate is high the enrolment to tertiary education is still very low compared to other nations and most of the labour force consists of individuals mostly men with secondary education.

 Full employment:

According to the table provided above the rate of unemployment s at 4.6 %, given the population of is nation it means that about 0.23 people are unemployed. This fact could be due to the high workforce turnover of the nation. Consisting mainly of the people from South Asia and other Arab countries. Even with this low rate of unemployment, only part of the population is used in the labour force that is 77%. The majority of which are men. Note from the data that infant mortality is higher in men than in women and the life expectancy of women is also higher than that of men. These statistics show that at any given period it is likely that the number of women will be higher than that of men, and yet the number of men in the labour force is higher. The goals of every economy are to reduce the rate of unemployment to the lowest possible level which could be zero. 5% is not the lowest possible levels for UAE given the majority of the citizens are women.

Stable Prices:

 

 The economy of the United Arab Emirates is greatly dependant on the oil prices since the export of crude oil to other Asian countries is a major contributor to its gross domestic product. It is almost common knowledge that oil is among the goods whose prices change. With this in mind it is difficult to stabilize the prices of other goods and services if the price of the primary source of fund is frequently fluctuating. Despite this reality the government of the Unite Arab emirates has strived to maintain relatively stable prices.Inflation rates varied greatly between 2008 and 2009 dropping from 12.3 to 1.6. This is positive inflation since the relative prices of goods dropped the inflation rate changed only minimally from 2009 to 2010 dropping to 1.0 further reducing the relative prices of goods.

Reference:

 Haryprantomo, A., Kos, S., Samtani, L., Subramanian, S & Verjee, J. (2011).

Microeconomic competitiveness, the Dubai Tourist Cluster: from desert to dream. Available at http://www.isc.hbs.edu/pdf/Student_Projects/UAE_%28Dubai%29_Tourism_2011.pdf

International Human Development indicators, (2012). UAE country profile: human

development indicators. Available fromhttp://hdrstats.undp.org/en/countries/profiles/ARE.html

Samba financial group (2009). The UAE: 2009 midyear economic update samba Saudi

Arabia.

United Arab emirate national bureau of statistics (2009). Analytical report on the economic

and social dimension in the UAE in 2009. Available at http://www.uaestatistics.gov.ae/ReportPDF/Analytical%20report%20on%20economic%20and%20social%20dimensions%20in%20the%20united%20arab%20emirates.pdf