NEW YEAR 2014: UAE MARCHING AHEAD
- January 1, 2014
- Posted by: RKonnect
- Category: Business & Economy
A new year has begun with yet another gigantic fireworks in UAE. Dubai, the second largest emirate in UAE and Las Vegas of the East has set the stage on fire. Besides, the spectacular midnight fireworks in Burj Khalifa and Burj Al Arab, the second largest Emirate had showcased a six minute of firework display across the Palm Jumeirah and World Islands. The record breaking firework had featured 200 expert pyro technologists and stretched across 100 kilometers of shoreline.
UAE, which was once an amalgamation of sleepy Arabian villages spread across its seven emirates, has gobsmacked the globe with its huge economic strides undertaken. It was vast petroleum reserves complemented with iconic leadership which paved way for economic diversification. It was more visible across Abu Dhabi, Dubai and Sharjah. Our previous blogs have reported the phenomenon in lengths and breadth about economic transformation of the gulf state.
However, what moves up has to fall down and the given fundamental of physics is as relevant in the realm of economics as much in physics. UAE’s growth rate, which once continuously featured in the double digit bracket, was hit hard by the global economic downturn. In between 2009-12, the economy in UAE registered a sub-standard economic growth rate between 3-4 percentage brackets.
But a culture, which was deeply rooted in the fundamentals of resilience associated with energy reserves, was close by. By the middle of this year, things appeared back on track and the economic recovery got expressed in the form of vibrancies in labor market and real estate sectors.
The confidence in real estate sector was driven by multitude factors such as higher liquidity, buoyancy in labor market and stricter regulatory policies. It saw numerous projects being re-announced, which was shelved due to the real estate bubble burst in the 2009. However, the real estate recovery was not the best thing which could have happened to UAE, in this year. Something much phenomenal and larger was taking shape at office in Paris.
At the end of November 2013, Dubai won the much anticipated bid to conduct the World Expo 2020. The event is expected to have a long lasting impact on Dubai’s economic life. Endorsed by a slew of heavy weight international players such as USA and United Kingdom, the emirate was appearing as a much strong contender in comparison to other counterparts. The victory at Paris was an outcome of sheer hard work and meticulous thinking by the leadership and the management committee. The icing on the cake was AED 20 billion (USD 5.5 billion) social and economic investment announcements made by Abu Dhabi, in the light of Dubai’s winning the bid. It reflected the solidarity which amassed all the seven emirates in successfully delivering an event.
Besides being a huge economic affair in itself, the World Expo 2020 is expected to dovetail numerous other sectors and sub-sectors in the Emirate such as aviation, hospitality, media, transportation and real estate etc. Dubai is planning to build a world class Expo center in the Maktoum city, which is the expected venue for the exposition. Aligned with the exposition planning is the new airport plan that is expected to leapfrog Dubai as the largest airport in terms of passenger traffic across the globe, surpassing the Heathrow Airport in London. On similar lines, huge investments are underway to extend the present Dubai Metro line.
Simultaneous to the high voltage Dubai 2020 campaign, a similar massive economic campaign is shaping up in Abu Dhabi in the form of economic vision 2030. The 22 year plan is aimed at systemically diversify the economy into multitude of alternate sectors such as petrochemical, tourism, trade, education, healthcare and media etc. The outlined strategic roadmap for economic vision 2030 is aimed at synergizing the public and private sector towards stimulating high economic growth, creating wealth and realizing wellbeing of the people in Abu Dhabi as well as pan UAE.
Along with Abu Dhabi and Dubai, other emirates are also catching up fast. Sharjah, which till now accounts for a large portion of industrial output in UAE, is pulling up its sleeves to successfully expand its presence in numerous sectors such as real estate, tourism, aviation, trade and logistics etc. Sharjah already has a robust LCC based aviation sector and is seeking rapid expansion in multiple new markets in South East Asia, Europe and Middle East. Its real estate sector which is largely correlated to neighbouring Dubai is experiencing bloom across residential and rental markets.
Brewing up the different ingredients of UAE’s economy, it would be an understatement, if it is assumed that, exciting times are not ahead for the gulf country. With mega events such as Expo 2020 and Economic Vision 2030 along with multitude of individual initiatives, which has been rolled out across the seven emirates, UAE is surely marching ahead.
Research Konnection FZE
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