uae - qtr

Compare UAE Economy With Another Country Econom

UAE and Qatar form states within the pronounced gulf oil international producers and exporters. Oil production is core to the States' economic performance. The unemployment levels within the labour market have stabilized at average of 4 % (Al‐Hashemi et al. 2012). The preference for the employments within the public sector among the UAE nationals contribute to higher unemployment rates at 14% vis-a-vis expatriates case (Al‐Hashemi et al. 2012). The employment preference is driven by a relatively better remuneration package. The economy of UAE by far relies on the state owned enterprises.  In the case of Qatar unemployment rates has been on a downward trend, at 3.9% in 2011 from 4.1% in 2010.According to UNDP (2012), lack of skills and experience as well as qualification disconnects contribute to unemployment rates among the Qataris. There is virtually no unemployment among the expatriates since they are under the employer's sponsorship.

Prices in the UAE have stabilized over the last two decades, however picked up in 2009 to reach 2% from 1.2%. Low inflationary rates is due to strength in the dollar and friendly interest rates level as well as slow growth of domestic demand. Availability of housing has contained their prices and rent as well as cost of food commodities. In Qatar, inflation 4.4% in 2011 up from 2.2% in 2010 as reflected in house-rents, utility and food prices (General Secretariat for Development Planning, Qatar, 2011). Welfare-programmes to cushion low-income Qataris from inflationary pressures are largely non-existent (UNDP, 2012).

UAE GDP performance was $46 billion in 1995 and appreciate by almost 600% in 2010 to $270 billion. The performance was attributed to enhancing skill of the populace, diversified-free economy, modernized infrastructure and socio-development (Bertelsmann Stiftung, 2012). Qatar’s GDP in 2010 was $127.3 billion. In 2011, GDP per capita was  $67,008 up from $47900 and $48900 in 2010 and 2009, respectively. Qatar's GDP per capita was $109000, $74900and $59700 in 2011, 2010 and 2009, respectively. Economic growth in Qatar was spurred by expansion of national hydrocarbon capacity (General Secretariat for Development Planning, Qatar, 2011).

UAE trade balance in 2011 was $ 94 billion. Even with slight decline in global oil prices, the higher oil production and subsequent export volumes maintain high trade balance for UAE. Qatar's trade balance rose from $93 billion in 2009 to $196 billion in 2010 (Qatar Statistics Authority, 2012). Qatar's balance of trade performance was driven by hydrocarbon output and rise in their prices (General Secretariat for Development Planning, Qatar, 2011).

In conclusion, the economic performance of UAE remains impressive; however on the flipside, this is driven by expatriates who constitute 70%. This implies that the economy largely relies foreign skill and has tailored labour laws to attract expatriates to serve in some key sectors. Indeed, some benefits from the economy are largely enjoyed by foreigners than natives; a case point is the private sector entrepreneurship opportunities. Qatar has effectively externalized the cost of expatriates to the employer to cater for upkeep and residence that reduce markedly competition for jobs, locally. This eliminates unnecessary in flux of expatriates as well as economic gains from wage earnings to other countries. Nevertheless, both countries need to diversify sources away from oil and gas in order to cushion citizenry from exhaustion of reserves and economic collapse. Probably, review education programmers to inspire and attract nationals into the private sector.

 

 

 

References

Al-Hashemi, H,  Lamanauskas, T, Kumail, A A, Kholjigitov, G A, & Antony, A. 2012. Abu Dhabi- UAE Petrochemical Cluster Microeconomics of Competitiveness: Firms Clusters and Economic Development, viewed 12 November 2012, <http://www.isc.hbs.edu/pdf/Student_Projects/2012%20MOC%20Papers/UAE%20Petrochemical%20Cluster%20Report%20Final%20May%2004%202012.pdf>.

Bertelsmann Stiftung, 2012. United Arab Emirates Country Report, viewed 12 November 2012, <http://www.bti-project.de/fileadmin/Inhalte/reports/2012/pdf/BTI%202012%20United%20Arab%20Emirates.pdf>.

General Secretariat for Development Planning, Qatar, 2011. Qatar Economic Outlook 2011–2012, viewed 12 November 2012, <http://www.gsdp.gov.qa/portal/page/portal/gsdp_en/knowledge_center/Tab2/QEO11_English25Oct.pdf>.

Qatar Statistics Authority, 2012. Qatar Economic Sttatistics at a Glance.  viewed 12 November 2012, <http://www.qsa.gov.qa/eng/publication/economic_publication/2012/Qatar%20Economic%20Statistics%20at%20Glance.pdf>.

UNDP, 2012. Qatar’s Third National Human Development Report, viewed 12 November 2012, <http://www.menafn.com/updates/research_center/Qatar/Economic/kamco100311ee.pdf>.