UAE’s Prime Minister plans to diversify its economic structure by boosting foreign trade. The aim is to increase 50% of exports in the future. In the Cabinet meeting at Al Watan Palace in Abu Dhabi, he outlined that the country will expand the foreign trading in 25 international markets as per the plan.
The country is one of the highest in foreign trade, and annually the UAE’s non-oil trade exceeds Dh1.5 trillion. The volumes are expected to rise by up to 12.9% year-over-year in 2021, plus the logistics network crosses 350 international cities. In the first half of 2020, non-oil trade reached Dhs658.3 billion, valued at 41 percent of the entire country’s trade value in 2019.
However, the primary source of non-oil revenue is the country’s tourism. The non-oil economy shrunk due to the pandemic for the first time since 2011 to 6.2% last year. However, it is recovering and is expected to grow 3.6% in 2021. Additionally, the United Arab Emirates attracted Foreign Direct Investment of nearly $20 billion in 2020.
It is the fourth largest economies in the Middle East. The factors contributing to UAE’s strong economy are:
- Huge sovereign wealth fund.
- Strong financial reserves.
- Good investor relations.
- Diversified economic policies.
- Higher foreign direct investment and free zones.
- Government spending.
The minister informed that additional steps to fund the growing research and development sector would improve the economy. He added that the country needs robust R&D to have a competitive edge globally. Therefore, government spending on research and development accounts for 1.3 percent of its GDP.
The Cabinet addressed the needs of crèches and daycare centers at the government offices to promote women’s empowerment. The measure will increase the number of women employees. These nurseries and crèches will work under the license and supervision of the Ministry of Education and local educational authorities.
UAE workforce is expected to increase in 2021, with 62 percent of UAE nationals and 56 percent expatriate workers. A Hays 2021 Emiratisation Salary & Employment report says that as the economy is rebounding, 43 percent of the Emirati workers expect increased salary, and 45 percent of ex-pat workers anticipate a rise in pay scale in 2021.
Sheikh Mohammed said: “The goal is a quality of life that is the best in the world based on an economy that is the most diversified and established.”