Demography, Geography, and Government - Abu Dhabi - Essay Example

ABU DHABI By Macro & Micro economics The of the School The and where it is located The ABUDHABI Demography, Geography, and Government Abu Dhabi is one of the solidest economies globally. Geographically, the emirate of Abu Dhabi has a vast proportion in terms of mass of the nation. Most of the land is made up of dessert, although it has a considerable length of coastline and several islands. Its location is strategically in the oil-rich and Gulf expanse neighbouring Saudi Arabia and Sultanate of Oman. Sand humps and an expansive sandy topography characterize the area. The oil-mining business and gas reserves are a considerable influence for its ever-increasing economic growth (ADCED, 2012). Its economic strength supersedes the world-wide financial crisis that had unfavourable effects in other regions. Its demography is characterized by almost 8-10 million inhabitants and a portentously ethnologically diverse populace. Its populace consists of Americans, Arabians, and Asian nationals. In terms of governance, the emirate has maintained a hereditary form of governance since its inception. Its executive council that largely constitutes of the ruling family members is the main decision-making organ in Abu Dhabi. Performance during the past 10 years In the last 10 years, Abu Dhabi has had noteworthy infrastructure and erection of major attractions. This has had substantial changes in the performance of the economy in the last decade. For instance, the occupancy rate in Dubai and Abu Dhabi has increased noticeably and the tourism rate has steadily intensified (Algethami, 2013). Abu Dhabi demonstrates a spot-on characterisation of distinction bearing in mind its enthralling past. The past ten years have been characterized by a massive influx of expatriates because it is considered a tax-haven. All its recent projects are more awesome than the one previously built. Overall Economic Performance Previously, the labour force was based on the oil-based segment and was relatively underdeveloped. The nature of professions available was not diversified and were limited to a specific sector. However, the recent developments by subsidiaries means that more jobs are obtainable and the economy is open (ADCED, 2012). Lesser taxes and attractive infrastructure encourage investments in other sectors that are not oil-related. Abu Dhabi has strict laws that guide the importation of specific goods. Importers should familiarize themselves with these laws. In 2013, the value of imports into Abu Dhabi increased by 42.5 percent (Pantin, 2009, p. 1). This increase was supported by increased shipments of building materials, industrial equipment and machinery (Oxford Business Group, 2010, p. 21). Abu Dhabi’s non-oil exports were worth AED 11.5 billion in 2013. The main non-oil exports are base metals and transportation equipment, which contributed 61.5 percent of all non-oil exports (Davidson, 2011, p. 16). Canada was the main destination for non-oil exports. In 2013, Abu Dhabi exported 747.2 million barrels of oil. Japan was the main importer of Abu Dhabi’s oil (Oxford Business Group, 2010, p. 28). Abu Dhabi has experienced an increase in the demand for energy. There has been an increased demand for petrol and diesel, to power vehicles and homes and natural gas to produce electricity. Energy demand in Abu Dhabi is growing at an annual rate of 9 percent, which is three times the global rate. Currently, Abu Dhabi is focused on nuclear energy, which will help in meeting the current and future demands for energy (Cordesman, 2004 p. 34). In terms of telecommunication, most of the people in Abu Dhabi use mobile phones to communicate. However, people who do not have mobile phones can use public service telephones, which are located throughout the city. The main telecommunication companies in Abu Dhabi are Warid, Etisalat, SAFA Telecom and Axiom telecom (Oxford Business Group, 2010, p. 39). These firms also offer internet services and they are supported by the latest telecommunication technologies. The business sector and potential investors collaborate in a beneficial way for Abu Dhabi’s economy. It is only through diversified structures that a solid economy can be attained. This includes the air, road, and water and sector, which promotes smooth transportation. The policies instituted by the government ensure that Abu Dhabi’s economy remains to realize quantifiable and qualitative expansions in most areas. Its GDP had an increase of 7.7% in 2012 and this rose in the last year. This is mainly attributable to the upsurge in oil manufacture and charges in the global market. A significant diminution in inflation rate was recorded in the past year. In 2013, foreign direct investments (FDI) rose by 7.8 percent to AED 52.2 billion. These investments were focused on the hospitality, construction, health, transportation, communication, storage, and whole and retail sectors (Nicholls, 2012, p. 12). The increase in foreign direct investments can be attributed to increased transparency in the country. Tourism in UAE In its development objectives, UAE has a special concentration in the tourism segment. UAE remains to be a principal tourism terminus across the region. Dubai is part of the UAE and it entices tourists primarily because of shopping and its modern attractions. The forms of tourism rang from shopping experiences, cultural diversity, business, and sports industry. Undeniably, this provides the right requirements for a favourable tourism target. In addition, it is a safe and welcoming destination that is largely culture diverse. Even so, there are stringent Muslim principles observed in some areas. The UAE has admirably redefined the sense of hospitality for both businesspeople and holiday-seekers through its outstanding beaches and fashionable hotels. Tourism in Abu Dhabi: Benefits for the Internal Economy and Possibility for Investments As a political hub and oil-rich location, Abu Dhabi is richer than Dubai coupled by its lower living costs. Abu Dhabi has considerably invested in tourism. Its economic vision indicates that the country has substantially invested in non-oil sectors such as tourism. In particular, there is a concentration in the business and cultural sectors. In terms of leisure, the government has ensured there are enough entertainment facilities to satisfy the fancies of visitors. Its infrastructure and out-of –the-world facilities provide a suitable tourist attraction. Investment is habitually directed to the accommodation sector because the region anticipates more vacationers. The money acquired from the sector emboldens the local authorities to fortify the tourism sector. Tourism plays an indispensable part in terms of benefits accrued by the internal economy. In addition, the interest by expats to the country has increased the prospect of vital investments. The education sector has expanded owing to the diverse culture of expats and locals. This introduces tourism and educational opportunities that substantially aids the internal economy. The real-estate segment has seen a considerable boost because of the latest ultramodern structures. The government seeks to preserve its plentiful natural resources and cultural customs, which ensures the interest in potential investments and boost in internal economy developments. Conclusion The country’s recent interest in diverse territories ensure overseas funds are channelled into local economy. An increase in profits from the non-oil sector guarantees a better economy for the country in the imminent future. Abu Dhabi remains to be economically competitive and this enhances work opportunities for the populace. Although the globally increasing oil prices enhanced the economy, the other non-oil sectors guaranteed the GDP had the needed steadiness. It has significantly aided its competitive advantage and continues to attract both foreign and local investments. List of References ADCED, 2012, Abu Dhabi’s Economic Performance in the Last 10 Years Chart book (2001-2010). Abu Dhabi Council for Economic Development. Algethami, S., 2013, Why the UAE is a Leading Tourism Destination in the Region. Gulf News. Accessed on March 16, 2013 from: http://gulfnews.com/business/tourism/why-the-uae-is-a-leading-tourism-destination-in-the-region-1.1261536 Cordesman, A. H., 2004, Energy Developments in the Middle East. Westport, Conn, Praeger. Davidson, M. C., 2011, Abu Dhabi: Oil and Beyond. London, C Hurst & Co Publishers. Nicholls, D., 2012, Foreign Direct Investment: Smart Approaches to Differentiation and Engagement. Farnham, Surrey, England, Gower. Oxford Business Group, 2010, The Report: Abu Dhabi 2010. Oxford. Oxford Business Group. Pantin, T., 2009, Abu Dhabi Imports Up 42% in 2008. The National. Accessed on March 16, 2013 from: http://www.thenational.ae/business/economy/abu-dhabi-imports-up-42-in-2008 Read More