The drivers of the UAE’s economy in 2021 included five key pillars…reports Asian Lite News
The drivers of the UAE’s economy in 2021 included five key pillars, which are the launch of an industrial strategy worth AED300 billion, the start of trading in Murban crude oil, the launch of the first projects of the “Projects of the 50”, Expo 2020 Dubai, and the announcement of President His Highness Sheikh Khalifa bin Zayed Al Nahyan of the most significant legislative reform in the country’s history that included over 40 laws.
The year 2021 also saw the UAE advancing in global competitiveness indexes and the announcement of major investment projects and strategic plans to achieve sustainable development across multiple sectors, in line with international standards.
Key economic projects and plans announced by the UAE in 2021 included an industrial strategy to boost the sector’s contribution to national GDP to AED300 billion, compared to the current AED133 billion, and a plan aimed at doubling foreign trade value to AED3 trillion during the same period, an increase of AED1.5 trillion, in addition maintaining an annual economic output exceeding AED1.5 trillion and investing nearly AED600 billion in renewable energy to achieve climate neutrality by 2050.
The country’s economic objectives also included generating economic proceeds amounting to AED200 billion through UAE Railway Programme, which included investments amounting to AED50 billion, and by approving a federal budget with expenditures of AED290 billion for the 2022-2026 period, increasing the contribution of the National In-Country Value Programme from AED22 billion to AED55 billion by 2025, doubling foreign investments in the country to AED1 trillion in nine years, an increase of AED550 billion, and achieving an annual increase of AED45 billion in exports across 10 foreign markets through 10×10 Programme.
Plans and Objectives
The UAE’s economic plans and ambitions announced for the coming period include boosting and diversifying opportunities in several areas such as artificial intelligence (AI), the digital economy, the circular economy, innovation, space, health, agriculture, advanced industries, healthcare and food industries, and the adoption of innovative economic models, in line with new global trends.
The initiatives announced relied on extensive studies of the global situation to shape the UAE’s strategic direction, including rapid technological developments and their impact on economic sectors and traditional jobs, the social changes taking place globally and the structural transformations they cause to consumer spending.
These initiatives coincided with the launch of the Global Competitiveness Report 2021, where the country led the Middle East and North Africa (MENA) region for the fifth consecutive year, ranking ninth in the top ten list of the world’s most competitive countries. In the report, the UAE ranked first globally in 22 indexes, among the top five countries in 62 indexes, and among the top ten in 120 indexes, out of a total of 335 indexes in the report.
Furthermore, 2021 also witnessed the resumption of conferences and exhibitions after the pandemic, especially as Expo 2020 Dubai made unprecedented contributions in terms of driving the sector, despite the implementation of strict health and safety measures.
On 22nd March, 2021, the UAE launched its industrial strategy, titled “Operation 300bn”, to increase the industrial sector’s contribution to the GDP from the current AED133 billion to AED300 billion over the next 10 years. The strategy included 17 initiatives aimed at achieving its objectives by 2031.
On 29th March, 2021, the Abu Dhabi National Oil Company (ADNOC) and Intercontinental Exchange (ICE) officially announced the start of trading of the UAE’s flagship crude oil, Murban, as a Futures contract on the new ICE Futures Abu Dhabi (IFAD) commodities exchange.
This historic and strategic achievement enhanced the stature of the UAE, particularly the emirate of Abu Dhabi, as a pioneering energy hub, and confirmed ADNOC’s pivotal role as a key contributor to achieving the country’s economic goals.
On 5th September, 2021, the first set of strategic projects and initiatives of the Projects of the 50 was launched and included the 10×10 programme aims to achieve an annual increase in the country’s exports by 10 percent in ten key markets; China, the UK, the Netherlands, Italy, Russia, Poland, Luxembourg, Australia, New Zealand and Indonesia.
The project aims to achieve a 14 percent growth in cumulative foreign direct investment (FDI) outflow by 2030, as well as 24 percent growth in FDI directed to the targeted countries by 2030.
An e-portal, Invest.ae, was also launched to serve as a hub for all investment-related local entities and 14 state economic entities, enabling them to showcase all investment opportunities across the UAE.
Emirates Investment Summit
The UAE also announced the Emirates Investment Summit, a global summit that will connect investment funds with the public and private sectors, to generate investment opportunities that will attract AED550 billion of FDI into the UAE over the next nine years.
Scheduled to take place during the first quarter of 2022, the summit aims to build lasting partnerships between the public and private sectors.
Global Economic Campaign On 6th September, 2021, the UAE unveiled a global economic campaign, titled ‘United Global Emirates’, to promote the country as a major hub for business, talents and foreign investment.
Champions 4.0 Network
Meanwhile, 12th October, 2021, saw the Ministry of Industry and Advanced Technology signing Memorandums of Understanding (MoUs) with 12 industrial entities to form the Champions 4.0 Network, which aims to kickstart the newly-announced Fourth Industrial Revolution programme, known as “UAE Industry 4.0”. The programme is aimed at increasing industrial productivity by 30 percent and adding AED25 billion to the country’s GDP over 10 years.
Moreover, the UAE’s non-oil foreign trade achieved a growth of 27 percent in the first half of 2021 compared to the same period in 2020, marking a 6 percent increase over the first half of 2019.
Preliminary official data indicated the country’s non-oil foreign trade was valued at some AED900 billion in the first half of 2021, while its non-oil exports increased during the same period to AED170 billion, achieving a growth of 44 percent compared to the first quarter of 2020.
Major Legislative Reform
In November 2021, President His Highness Sheikh Khalifa bin Zayed Al Nahyan approved the largest project to develop federal laws in the country’s history, which comprised over 40 laws to enhance the country’s economic environment and investment infrastructure, maintain the community’s security and stability, and preserve the rights of individuals and institutions.
The amendments included the development of a legislative structure that includes laws covering the investment, commercial and industrial sectors and companies, along with the regulation and protection of industrial property, copyright, trademarks, commercial register, electronic transactions and trust services. They also include a law on the entry and residence of foreigners and unified provisions of working conditions, in addition to laws related to community security, such as the the Crime and Punishment Law, the Online Security Law, and laws regulating the production, sale and use of narcotics and psychotropic substances.
On 1st December, 2021, five year business plan and capital expenditure (CAPEX) of AED466 billion ($127 billion) for 2022-2026 to enable its plans to expand its upstream production capacity and downstream portfolio as well as its low carbon fuels business and clean energy ambitions.
World’s Coolest Winter campaign
On 18th December 2021, the second season of the World’s Coolest Winter campaign was launched to highlight the UAE’s attractions to residents and tourists.