S. R.

Luthra Institute of Management

Project Work on:

ANALISIS OF GDP, INFALTION AND PRODUTION GROWTH OF
The United Arab Emirate (UAE)
Managerial Economics (ME)

Subject Code: MGMB11106

Submitted to: Submitted by:

Subject Faculty  Group no.: 8

1. Bhavya Shah (115)

Dr. Ranjan Sabhaya
2. Harsh Vardhan Sharma (119)
S.R. Luthra Institute of Management
3. Deep Shah (116)

4. Jigar Pokharna (95)

 We have selected The United Arab Emirate for this project

work.

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  In this project we analyse different data of GDP, INFLATION
AND PRODUTION GROWTH from some trusted source and
make report of it as given blow :

INTRODUCTION OF UAE

The United Arab Emirate is a country in Western Asia located at the

eastern end of the Arabian Peninsula. It borders Oman and Saudi Arabia,
and has maritime borders in the Persian Gulf with Qatar and Iran. The
UAE is an elective monarchy formed from a federation of seven
emirates, consisting of Abu Dhabi (where the federal capital, Abu
Dhabi, is located), Ajman, Dubai, Fujairah, Ras Al Khaimah, Sharjah
and Umm Al Quwain. Each emirate is governed by a Sheikh and,
together, they form the Federal Supreme Council; one of them serves as
President of the United Arab Emirates. In 2013, the UAE's population
was 9.2 million, of which 1.4 million were Emirati citizens and 7.8
million were expatriates , the estimated population in 2020 was 9.89
million.

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 (The United Arab Emirate FLAG)

HISTORY AND VISION

In the early 1930s the first oil company teams conducted geological surveys in the UAE. Almost thirty
short years later, in 1962, the first cargo of crude oil was exported from Abu Dhabi. With the economy
steadily progressing, HH Sheikh Zayed bin Sultan Al Nahyan was chosen as the Ruler of Abu Dhabi in
1966. Under Sheikh Zayed, the steady oil revenues resulted in an infrastructure overhaul with the
construction of schools, housing, hospitals and roads throughout Abu Dhabi. 
One of Sheikh Zayed’s early actions was to increase contributions to the Trucial States Development
Fund, with Abu Dhabi becoming the Fund’s largest donor. Meanwhile HH Sheikh Rashid bin Saeed Al
Maktoum, de facto Ruler of Dubai since 1939, replaced pearling revenues by becoming a part of the
shipping industry. And, in 1969 as the Emirate of Dubai began exporting oil, Sheikh Rashid focused his
attention on developing programs aimed at improving the quality of life of his people with the new oil
revenues. In 1968, with the British announcement of its withdrawal from the Arabian Gulf, Sheikh Zayed
stepped into action to quickly establish closer ties among the Emirates. Together with Sheikh Rashid,
Sheikh Zayed called for a federation that would include not only the seven Emirates that together made
up the Trucial States, but also Qatar and Bahrain.

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An agreement was reached between the rulers of six of the Emirates (Abu Dhabi, Dubai, Sharjah, Umm
al-Quwain, Fujairah and Ajman), and the federation to be known as the United Arab Emirates was
formally established on 2 December 1971. The seventh Emirate, Ra’s al-Khaimah, acceded to the new
federation the following year.

Since the formation of the union, the seven Emirates have forged a distinct national identity. The UAE’s
political system has been designed to ensure the country’s heritage is maintained, adapted and
preserved by combining tradition with a modern administrative structure. 

MAP OF UAE

Nations are measured by their

heritage. A nation without heritage
is a nation without a land to live
on, or a shore to reach before
getting lost in the ocean - Sheikh
Zayed

“One of our key objectives … is to lay the groundwork for the emergence of a more active UAE
citizen. A nation is built by the thought and effort of its own citizens…to enhance unity, maintain
stability, meet citizens’ aspirations and embrace the rapid changes witnessed locally, regionally,
and internationally.”
HH Sheikh Khalifa bin Zayed Al Nahyan
UAE President

Some important details about The United Arab Emirate:

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President of UAE Khalifa bin Zayed Al Nahyan
PM of UAE Mohammed bin Rashid Al Maktoum
Capital Abu Dhabi
Official language Arabic
Currency The Emirati Dirham

What do you mean by GDP?

 Gross Domestic Product (GDP) is the monetary value of all

finished goods and services made within a country during a
specific period. GDP provides an economic snapshot of a country,
used to estimate the size of an economy and growth rate.

 GDP can be calculated in three ways, using expenditures,

production, or incomes. It can be adjusted for inflation and
population to provide deeper insights.

 Though it has limitations, GDP is a key tool to guide policy-

makers, investors, and businesses in strategic decision-making.

Introduction of UAE’s GDP:-

 The economy of the United Arab Emirates (or UAE) is the fourth largest in

the Middle East (after Turkey, Saudi Arabia and Iran), with a gross domestic
product (GDP) of US$421 billion (AED 1.5 trillion) in 2020. Economic growth
has been impressive and steady throughout the history of this young
confederation of emirates with brief periods of recessions only, e.g. in the
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 global financial and economic crisis years 2008–09, and a couple of more
mixed years starting in 2015 and persisting until 2019. Between 2000 and
2018, average real gross domestic product (GDP) growth was at close to
4%. Since its independence in 1971, the UAE's economy has grown by nearly
231 times to 1.45 trillion AED in 2013. The non-oil trade has grown to 1.2
trillion AED, a growth by around 28 times from 1981 to 2012. Backed by the
world's seventh-largest oil deposits, and thanks to considerate investments
combined with decided economic liberalism and firm Government control, the
UAE has seen their real GDP more than triple in the last four decades.
Nowadays the UAE is one of the world's richest countries, with GDP per capita
almost 80% higher than OECD average.
 United Arab Emirates is one of the most developed countries in the Arab Gulf
and has high value of GDP per capita. The country still has a commodity-based
economy, with shipments of oil and natural gas accounting for 40 percent of
total exports and for 38 percent of GDP. Yet, in order to diversify the economy
and reduce the dependence on oil revenues, UAE has been making huge
investments in the tourism, financial and construction sectors. In 2012,
manufacturing activity accounted for 42% of output growth,
transport/communication for 23%, and wholesale/retail trade for 16.5% and
restaurants/hotels for 15.5% while construction and agriculture contracted.

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Source: Word Bank

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Current economic condition:-

 The UAE’s is rated the most competitive economy in the Middle

East region and better than the US, Canada, Germany, China, UK,
Austria, Australia, South Korea, France and others.
 The UAE’s competitiveness ranking remained unchanged in 2021
despite the outbreak of Covid-19, as strong responses from the
government to contain the pandemic paid off well. The UAE
performed very well in the business and government efficiency
sub-indices. It was ranked first in the labour market and attitudes
and values; third in public finance and tax policy; fourth in
international trade; and fifth in business legislation.
 The UAE also made significant improvements in the sub-indices of
student mobility inbound, economic complexity index, stock
market capitalization, total public expenditure on education,
higher education achievement, number of patents in force, exports
of goods, total health expenditure, banking sector assets and
internet users that helped the country maintain its high ranking.
 The UAE’s position improves further to sixth in Europe, Middle
East and North Africa region, according to IMD World
Competitiveness Ranking 2021.Regionally, Qatar slipped three
places to 17th, Saudi Arabia fell from 24th to 32rd; and Jordan
jumped nine places to 49th.

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Number of items contributing for growth
of GDP:-
 The UAE has been successfully diversifying its economy, particularly

in Dubai. But the country still remains heavily reliant on revenues

from petroleum and natural gas, which continue to play a central role in
its economy, especially in Abu Dhabi. In 2009, more than 85% of the
UAE's economy was based on the oil exports. While Abu Dhabi and other
UAE emirates have remained relatively conservative in their approach
to diversification, Dubai was bolder in its diversification policy. Dubai

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 has far smaller oil
reserves than its
counterparts. In 2011,
oil exports accounted
for 77% of the UAE's
state budget. Tourism is
one of the bigger non-
oil sources of revenue in the UAE, with some of the world's most
luxurious hotels being based in the UAE. A massive construction boom,
an expanding manufacturing base, and a thriving services sector are
helping the UAE diversify its economy. Nationwide, there is currently
$350 billion worth of active construction projects.

1. Oil and Gas:-

 The UAE leadership has driven forward economic diversification efforts
already before the oil price crash in the 1980s, and the UAE is nowadays
the most diversified economy in the Middle East and North
Africa (MENA) region. Although the oil and gas sector does still play an
important role in the UAE economy, these efforts have paid off in terms
of great resilience during periods of oil price fluctuations and economic
turbulence. In 2018, the oil and gas sector contributed 26% to overall
GDP. The introduction of the VAT has provided the Government with an
additional source of income – approximately 6% of the total revenue in
2018, or 27 billion United Arab Emirates Dirham (AED) – affording its
fiscal policy more independence from oil- and gas-related revenue,
which constitutes about 36% of the total Government revenue. While
the Government may still adjust the exact arrangement of the VAT, it is

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 not likely that any new taxes will be introduced in the foreseeable
future.

2. Tourism:-
 Tourism acts as a growth sector for the entire UAE economy. Dubai is
the top tourism destination in the Middle East. According to the annual
MasterCard Global Destination Cities Index, Dubai is the fifth most
popular tourism destination in the world. Dubai holds up to 66% share
with Abu Dhabi having 16% and Sharjah 10% of the UAE’s tourism
economy. On 6 January 2020, Prime Minister Sheikh Mohammed Bin
Rashid Al Maktoum announced that the tourist visa to the United Arab
Emirates, which was earlier valid for 30–90 days, was extended to five
years. It has been projected that the travel and tourism industry will
contribute about 280.6 billion United Arab Emirati dirham to the UAE's
GDP by 2028.

3. Local markets and export:-

 The country produces a large percentage of its vegetable needs,
including tomatoes, cucumbers, aborigine, cabbage, squash,
mushrooms, lettuce, and cauliflower. Despite the decrease in cultivated
area, the number of vegetables produced increased by 26 %on average
from 2005 to 2009, and production increased from 494,000 tons to 1.3
million tons. This indicates an increase in productivity per hectare. In
addition to dates, some fruits, such as mango, citrus, papaya, and
watermelons, is also produced on a smaller scale, as is tobacco. The UAE
also produces about 25% of its poultry meat and 60% of its eggs from

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 local poultry farms. In 1991 local dairies produced approximately 92%
of the domestic demand for milk.
 The UAE exports fruits and vegetables to markets in the United States
and Great Britain dates to Japan, Indonesia, Malaysia, and flowers
to Gulf Cooperation Council countries, Lebanon, Great Britain ,Australia,
and Japan.

4. Trade:-
 In 2019, UAE’s GDP was an estimated $405.8 billion (current market
exchange rates); real GDP
was up by an estimated
1.3%; and the population
was 11 million. (Source:
IMF). UAE is currently our
30th largest goods trading
partner with $24.3 billion in
total (two way) goods trade
during 2019. Goods exports
totaled $20.0 billion; goods imports totaled $4.3 billion. The U.S. goods
trade surplus with UAE was $15.6 billion in 2019. According to the
Department of Commerce, U.S. exports of goods to UAE supported an
estimated 104 thousands jobs in 2015 (latest data available).

5. Real estate:-
 The development in the real estate and infrastructure sectors during
the recent year has contributed in making the country a global touristic

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 destination. The contribution of tourism in the Emirati GDP increased
from 3% in the mid-1990s to more than 16.5% by the end of 2010. This
trend is supported by the huge public investments in touristic projects
(47 Billion Dollars) carried mainly to expend airports, increase their
capacity, set up new airports and ports. The real estate sector have a
positive impact on development, job opportunities, investments and
tourism as estate projects were launched to meet the needs of market
and the increasing demand for housing and commercial units especially
in Dubai and Abu Dhabi. The UAE has 18 tour hotels out of the 155 (150
meters high) that exist around the world. This makes the UAE the third
destination with such tours after China and America in 2014. The leap in
real estate sector along and infrastructure development in the UAE
during the recent year has contributed in making this country a global
touristic destination par excellence.

6. Business and Finance:-

 The UAE offers businesses a strong enabling environment: stable
political and macroeconomic conditions, a future-oriented Government,
good general infrastructure and ICT infrastructure. Moreover, the
country has made continuous and convincing improvements to its
regulatory environment and is ranked as the 26th best nation in the
world for doing business by the Doing Business 2017 Report published
by the World Bank Group. The UAE are in the top ranks of several other
global indices, such as the World Economic Forum's (WEF) Global
Competitiveness Index (GCI), the World Happiness Report (WHR) and
the Global Innovation Index (GII). The Economist Intelligence Unit (EIU),
for example, assigns the UAE rank two regionally in terms of business
environment and 22 worldwide. From the 2018 Arab Youth Survey the

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 UAE emerges as the top Arab country in areas such as living, safety and
security, economic opportunities, and starting a business, and as an
example for other states to emulate.

7. Political and Social stability:-

 The UAE offers businesses a strong enabling environment: stable
political and macroeconomic conditions, a future-oriented Government,
good general infrastructure and ICT infrastructure. Moreover, the
country has made continuous and convincing improvements to its
regulatory environment and is ranked as the 26th best nation in the
world for doing business by the Doing Business 2017 Report published
by the World Bank Group. The UAE are in the top ranks of several other
global indices, such as the World Economic Forum's (WEF) Global
Competitiveness Index (GCI), the World Happiness Report (WHR) and
the Global Innovation Index (GII). The Economist Intelligence Unit (EIU),
for example, assigns the UAE rank two regionally in terms of business
environment and 22 worldwide. From the 2018 Arab Youth Survey the
UAE emerges as the top Arab country in areas such as living, safety and
security, economic opportunities, and starting a business, and as an
example for other states to emulate.

Reasons for growing UAE’s GDP in last

few years:-
1. Private sector hiring plans
2. Non-oil sector growth
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 3. UAE fiscal surplus
4. Infrastructure spending

INFLATION
What do you mean by inflation?

Inflation is a quantitative economic measure of a rate of change in

prices of selected goods and services over a period of time. Inflation
indicates how much the average price has changed for the selected
basket of goods and services. It is expressed as a percentage. Increase
in inflation indicates a decrease in the purchasing price of the
economy.

What are the 3 types of inflation?

The three types of Inflation are Demand-Pull, Cost-Push and Built-in

inflation.

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 1. Demand-pull Inflation:  It occurs when the demand for goods or services
is higher when compared to the production capacity. The difference
between demand and supply (shortage) result in price appreciation.

2. Cost-push Inflation:  It occurs when the cost of production increases.

Increase in prices of the inputs (labour, raw materials, etc.) increases
the price of the product. 

3. Built-in Inflation:  Expectation of future inflations results in Built-in

Inflation. A rise in prices results in higher wages to afford the increased
cost of living. Therefore, high wages result in increased cost of
production, which in turn has an impact on product pricing. The circle
hence continues. 

What is the inflation rate formula?

Inflation rate formula is the difference between initial CPI and final CPI
divided by initial CPI. The result then multiplied by 100 gives the inflation
rate.

Rate of Inflation = (Initial CPI – Final CPI/ Initial CPI)*100

CPI= Consumer Price Index

How to calculate inflation rate?

Inflation is calculated using the Consumer Price Index (CPI). Inflation can be
calculated for any product by following these steps.

 Determine the rate of the product at an earlier period.

 Determine the current rate of the product

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 Use the inflation rate formula (Initial CPI – Final CPI/ Initial CPI)*100.
Here CPI is the rate of the product.
 This gives the increase/decrease percentage in the price of the product.
One can use this to compare the inflation rate over a period of time.

Here we used only one product to calculate inflation. However, the Ministry of
Statistics calculates inflation using a basket of selected goods and services. 

Inflation in the United Arab Emirates

Introduction
The United Arab Emirates (UAE), as a small economy with an open capital account and
pegged foreign exchange rate regime, has limited scope for exerting an independent
monetary policy. More specifically, given that its key policy objective is to maintain a
stable peg with US dollar, domestic short-term interest rates generally follow US
interest rates and therefore, the Central Bank of the UAE (CBUAE) does not anchor the
inflation target. Moreover, inflation in the UAE moves for the most part in response to
other forces that are not under the direct control of the central bank. Specifically, non-
tradables account for 63% of the CPI basket, of which housing accounts for 39% of the
total. Further, inflation of tradables (37% of the CPI basket) moves with developments
in the nominal effective exchange rate (NEER), largely attributed to bilateral movements
in the US dollar with respect to major trading partners. While there is no explicit
inflation target in the UAE, inflation is an important economic indicator which the
CBUAE closely monitors.

Inflation measurements
Inflation measures how quickly prices of a basket of goods and services rise in a given
period of time. In other words, it measures the general price level, where a positive
figure implies an increase in the cost of living and a fall in the purchasing power of
money. In general, the prices of a basket of goods and services that are representative

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of the economy are collected; then the cost of this basket is collated to generate a
consumer price index (CPI), which is also called headline inflation. In the UAE, headline
inflation measures the price level of a basket of 334 different categories of goods and
services, collected by the Federal Competitiveness and Statistics Authority (FCSA). This
CPI is calculated by using a Young index, which assumes expenditure weights are
constant over time.

1. The Central Bank of the United Arab Emirates has developed a collection of other
operational and regulatory policy tools, such as liquidity management and
macroprudential measures, to complement the traditional monetary policy tools in the
absence of independence to set the policy interest rate. These tools play a significant
role in better monitoring monetary conditions (including inflation) and safeguarding
overall economic and financial stability in the UAE.

2. The Young index differs from the Lowe index, where quantities are constant over time
and expenditure shares are price-updated every month. In general, the Young index
tends to underestimate price movements relative to the Lowe index

Analysis of Inflation Data of UAE

The UAE experienced sustained inflation during the last decade. We noticed
different sources of data pertaining to our problem. For instance, the following
figure represents a rapid increase in the inflation rate in the Emirate of Abu Dhabi.
The rate continuously increases from more than 3% (2001) to around 13% (2008).
In 2020, the inflation rate of the United Arab Emirates was at 1.25% compared to
the previous year.

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19
According to a recent report issued by the Department of Economic Development in
Abu Dhabi, the inflation rate in the UAE reached 12.9% (2008). This increase is
caused by an increase in prices of raw materials, oil, and imports in addition to
depreciation of US dollar exchange rate. The report added that the rent was the
highest factor influencing inflation in which the weight of rent takes more than 40%
of the consumer basket.

 The Consumer Price Index in the UAE declined by 1.9% in 2019, which is the
first negative annual change in CPI inflation since the Index was first reported
by the Federal Competitiveness and Statistics Authority (FCSA) in 2009.

 Deflation was driven by the continued decline in rents and utilities prices,
which represent 34% of the consumption basket, the appreciating Dirham (in
nominal terms) and the fading effect of the VAT introduced at the beginning
of 2018. Moreover, the CPI was influenced by the drop in oil prices, which
was transmitted to the domestic fuel prices through the transportation prices,
assumed to be split equally between the tradable and non-tradable.

 The tradeable and non-tradeable prices have different drivers, hence their
dynamics are different. Inflation in tradable prices reversed from 6.9% in the
previous year to a deflation of -1.5% in 2019. Similarly, non-tradable prices
decreased by 2.2% in 2019 compared to an increase by 1.2% in 2018.

Effects of Inflation
 Higher inflation lowers the purchasing power of money. Dirham should
operate as a store of value. When the prices of different products
increase, the value of dirham will depreciate. Additionally the real
value of our salaries and savings will be less today compared to that of
last year.
 Inflation changes the distribution of national or aggregate income.
People living on fixed incomes are particularly hurt by inflation.
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  If prices of products increase faster than the increase in the wages or
salaries, we will find that the workers with fixed salaries will be able to
buy only fewer quantities of products. However, the businessmen who
get the profit, their income will increase rapidly and they will be better
off.
 The prices of consuming goods have increased faster than the prices of
factors of productions such as labor forces. That leads to depreciation
of our currency and results in a decrease in the purchasing power.

Causes of Inflation :-
 As oil prices have increased over the past years, the UAE has received an
increasing value of oil revenues resulting in an injection of liquidity into
the domestic markets. The inflationary pressure of money supply could
not be compensated by a rapid increase in domestically produced goods
and services. That results in an increase in prices.

 UAE economy is still rigid because the excess aggregate demand cannot
motivate the production process. In the long-run, we should work to
diversify the economy and give attention to technological innovation
and research.20 The basic cause of inflation is excess aggregate demand
stimulated by private consumption and government expenditures.

 Since the UAE economy is a developing economy and is not flexible, the
real output could not grow rapidly as aggregate demand. We can find
out the excess aggregate demand if we calculate it based on current
prices and compare it with real GDP based on constant prices.

 Inflation is caused by an excess demand in which demand exceeds

supply. The increase in aggregate demand is caused by a rapid increase
in oil revenues which leads to high rate of government expenditures.

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 For instance demand for housing units increases faster than the
increase in supply of housing units which results in an increase in rents.

 According to annual report (2019) issued by UAE Central Bank, total

expenditure rose by 31% based on current prices which is represented
as aggregate demand, while the gross domestic product grow by 13%
(2019) based on constant prices which is represented as real output.
The difference will put inflationary pressure on the UAE economy.

Solution of inflation :-

1. Monetary Policy: It determines the supply of currency in the market.

Excess supply of money leads to inflation. Hence decreasing the value of
the currency.

2. Fiscal Policy: It monitors the borrowing and spending of the economy.

Higher borrowings (debt), result in increased taxes and additional
currency printing to repay the debt.

3. Exchange Rates: Exposure to foreign markets are based on the dollar

value. Fluctuations in the exchange rate have an impact on the rate of
inflation. 

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Production Growth sector wise :-

1) Industrial Sector :-

 Together, oil and non-oil-related industries comprise the UAE’s largest sector,
totalling 51.5% of its economy.

 In 2009, the export of natural resources still accounted for more than 85% of
the UAE’s economy. According to Minister of Economy Sultan Bin Saeed al-
Mansouri, however, the UAE Economic Report of 2009 shows that oil’s

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 contribution to the UAE’s gross domestic product has fallen. In addition to oil-
related operations, there is a wide variety of other industries in the UAE.

 The manufacturing industries have developed quickly, taking advantage of

several factors, such as favourable tax laws, low labour costs, excellent
facilities, and political stability.

 The non-oil sector’s contribution to the GDP increased from 66.5% in 2008 to
71% in 2009. According to the report, manufacturing represented 16.2% of
GDP, followed by construction at 10.7%, while electricity, gas, and water
contributed 1.6%.

 According to the UAE Ministry of Economy, investment in the UAE’s industrial

sector was predicted to rise from USD 21.8 in 2007 to USD 30 billion by 2010
and USD 36 billion in 2012.

2) Services Sector:-

 The services sector – trade, restaurants, and entertainment; hospitality,

including hotels; transport, transit, and storage; communications; finance and
insurance; construction and real estate; business services; community, social,
and personal services – employed 58% of the labour force in the late 1990s,
reflecting its dominance of the UAE economy.

 Dubai has one of the largest service sectors in the country. The services sector
has contributed to the economic growth with an annual growth rate of 21%
since 2000, constituting USD 27.6 billion or 74% of Dubai’s GDP in 2005,
decreasing to 45.3% by 2011.

 In comparison, the trade sector has experienced the highest increase in GDP
share, and the manufacturing and oil- and gas sectors combined have
decreased. In contrast, the manufacturing sector has grown by an average of
12% annually since 2000.

 Under the new Companies Law, the UAE may allow foreigners to own 100%
of companies in the services industry. Foreign investors are currently
permitted to own a maximum of 49% of a UAE company. In certain areas of
the financial sector, such as insurance, the limit on foreign ownership is as
low as 2%.

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3) Agriculture:-
 The UAE has a small but steadily growing agricultural sector, despite the
country’s harsh desert conditions. Modern irrigation techniques, water from
aquifers deep underground, and desalination have made possible the
cultivation of large areas.

 The government supports agriculture through the free distribution of farm

lands, extensive price guarantees and subsidies.

 The Ministry of Agriculture and Fisheries oversees regulations and activities

in this sector. There are more than 800 companies working in the agriculture
sector, mainly in the richest emirates, Abu Dhabi and Dubai.

 Some small-scale farming thrives in oases and artificial farms, using various
methods of climate control and irrigation. Among the country’s products are
vegetables, watermelons, poultry, eggs, dairy products, and fish.

4) Oil and Gas sector :-

The United Arab Emirates (UAE) is an important strategic player in global energy
markets. As of 2019, the UAE is:

 A top-10 global crude oil producer.

 Member of the Organization of the Petroleum Exporting Countries (OPEC)

and the Gas Exporting Countries Forum (GECF).

 Major oil producer and exporter, producing an average of 4 million barrels

per day (bpd) of petroleum and other liquids, with reserves of nearly 100
billion barrels of crude.

 The UAE has served as a base for international oil companies, and always
encouraged foreign investment into its oil and gas exploration and production
sectors. U.S. oil and gas companies are strategically positioned as preferred
suppliers and contractors for the UAE, though they should expect tough
competition from Asian, European, and local firms.

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 According to the UAE State of Energy Report 2019, UAE has an estimated 98
billion barrels of oil reserves.

5) Construction Sector :-

 In the last five years, the GCC has experienced a record boom in the
infrastructure sector. Construction projects in the GCC exceeded $1 trillion,
with two-thirds of the projects being undertaken in the UAE.

 The construction and real estate sector in the UAE posted double-digit growth
on a year-on-year basis and contributed 15% to GDP.

 The unprecedented growth in the UAE’s construction and real estate sector
had Dubai and Abu Dhabi observing the highest increase in the number of
construction projects.

 Dubai has seen a major boom in the construction and real estate sector,
making it a hub for some of the world’s biggest construction companies,
including Nakheel PJSC and Emaar Properties PJSC.

 Moreover, as a regional hub for investments, the UAE attracts international

companies to establish offices. But the debt crisis that followed the
worldwide economic recession has had an impact on the sector.

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