The Report: Abu Dhabi 2023
Abu Dhabi is at the forefront of the MENA region’s economic expansion, posting a 9.3% growth rate in 2022. The emirate’s long-term development roadmap, the Abu Dhabi Economic Vision 2030, charts a course for economic transformation, targeting a 64% GDP contribution from non-hydrocarbons sectors by 2030, as diversification and strategic investment continue to make Abu Dhabi an attractive destination for businesses, investors and innovators.
Profile
Abu Dhabi, the largest emirate in the UAE, boasts 200 islands and 700 km of coastline. It is a vital player in the UAE’s economic and political landscape, with around 96% of the country’s oil reserves. To propel diversification, the Abu Dhabi Economic Vision 2030 is focused on key sectors such as finance, ICT, agri-tech, tourism and manufacturing. The Abu Dhabi Plan, meanwhile, which was initiated in 2016, aims to create a thriving private sector and enhance business opportunities. Despite headwinds stemming from the Covid-19 pandemic, Abu Dhabi is making strides toward a diversified, globally integrated economy. Priorities include knowledge-based sectors like tourism, manufacturing, logistics, health care, education, financial services and ICT. Private sector investment and foreign direct investment are key drivers in this regard. By 2030 non-hydrocarbons sectors are targeted to contribute 64% of GDP, with oil and gas to account for 36%. This chapter contains interviews with Sheikh Mansoor bin Zayed Al-Nahyan, Vice-President of the UAE, Deputy Prime Minister and Minister of the Presidential Court; and Sheikha Shamma bint Sultan bin Khalifa Al Nahyan, President and CEO, UAE Independent Climate Change Accelerators.
Explore chapterEconomy
Abu Dhabi contributes around 60% of the UAE’s GDP, with the country holding the world’s fifth-largest proven oil reserves, primarily located in Abu Dhabi. The emirate prioritises diversifying its economy and empowering the private sector. Timely fiscal interventions and robust sovereign assets have helped to cushion the Covid-19 pandemic’s impact, while forward-thinking policies and an attractive business environment are positioning Abu Dhabi for post-pandemic growth. Its focus on diversification and foreign investment in knowledge-based industries seeks to chart a course to a resilient economic future. The vision of a sustainable, diversified and open economy outlined in the Abu Dhabi Economic Vision 2030 is guiding the emirate’s policies. This ambitious roadmap centres around reducing reliance on oil and gas, increasing the role of knowledge-based industries and fostering a dynamic private sector, with Abu Dhabi’s determination to achieve these goals underscoring its commitment to long-term economic sustainability. This chapter contains interviews with Ahmed Jasim Al Zaabi, Chairman, Abu Dhabi Department of Economic Development, and Chairman, Abu Dhabi Global Market; Ahmed Khalifa AlQubaisi, CEO, Abu Dhabi Chamber; and Ahmed Al Naqbi, CEO, Emirates Development Bank.
Explore chapterTrade & Investment
Abu Dhabi’s commitment to diversification and improving its business environment led the emirate to record the MENA region’s fastest economic growth rate in 2022, at 9.3%. The focus on strengthening and diversifying manufacturing lines, alongside enhancing export capabilities, is propelling continued growth. Regulatory updates and progressive development strategies seek to revitalise foreign direct investment across key sectors such as real estate and high-value manufacturing. Collaborative efforts to bolster international trade and dynamic government bodies are helping to improve Abu Dhabi’s investment climate, fostering a thriving economy. As a result, Abu Dhabi has become a magnet for international investors, companies and entrepreneurs. The emirate’s expanding production profile is being harnessed to drive exports, contributing significantly to economic expansion. The synergy between public and private entities, exemplified by organisations like Mubadala Investment Company and ADQ, showcases the government’s commitment to driving growth and enhancing business ecosystems. This chapter contains interviews with Waleed Al Mokarrab Al Muhairi, Deputy Group CEO, Mubadala Investment Company, and Chairman, Mubadala Capital; and Hamad Al Ameri, Managing Director, Alpha Dhabi Holding.
Explore chapterBanking
Abu Dhabi’s banking sector thrives in a globally connected economy, supported by solid capitalisation, credit growth and profitability. The embrace of technological innovation and financial technology, coupled with strengthened cybersecurity and anti-money-laundering measures, positions Abu Dhabi’s banks for continued growth. High oil prices and a robust non-oil sector are expected to drive further expansion as digitalisation improves efficiency. At the same time, an ongoing commitment to regulatory and supervisory improvements is enhancing Abu Dhabi’s global standing and reinforcing its financial stability. Amid global efforts to tackle inflation, interest rates are expected to remain relatively high, though Abu Dhabi’s lenders are well provisioned to remain profitable. Credit growth is ongoing, albeit at a slower pace, as digitalisation efforts continue to enhance customer service while reducing operating costs. The broader UAE banking sector’s stability and continuity in the face of global challenges underscore its resilience. This chapter includes an interview with Khaled Mohamed Balama, Governor, Central Bank of the UAE.
Explore chapterCapital Markets
Abu Dhabi plays a central role in regional capital markets development, attracting government-owned companies seeking listings and contributing to sustainable asset regulatory frameworks. Amid global economic challenges, Abu Dhabi remains an attractive investment destination, with strong demand for its debt and a robust initial public offering (IPO) pipeline. Forward-looking regulatory measures, including carbon credit trading, are enhancing its appeal as the emirate continues to expand after the Covid-19 pandemic. Abu Dhabi’s economic trajectory, coupled with regulatory foresight, positions it as a promising investment opportunity in a changing global landscape. With fluctuating inflation and slowed productivity growth in developed markets, Abu Dhabi stands out as an attractive investment opportunity. Robust demand for its debt speaks to confidence in its future economic trajectory and its IPO pipeline appears strong. Ratings agencies affirm Abu Dhabi’s fiscal stability, highlighting its ability to maintain surpluses. This chapter features an interview with Maryam Buti Al Suwaidi, CEO, Securities and Commodities Authority.
Explore chapterInsurance
Abu Dhabi’s insurance sector has been boosted by post-Covid-19 pandemic recovery and a competitive landscape. Gross written premium and underwriting income continue to rise, particularly for health and medical coverage. Digitalisation, competition and potential market consolidation are expected to shape the sector’s future, and Abu Dhabi-based providers stand well positioned to benefit from ongoing economic growth and a broadening market, especially with the expansion of compulsory medical coverage. Factors like the IFRS 17 transition and post-pandemic medical costs are expected to drive improved financial performance. While the level of competition remains high, companies adapting to regulatory controls and solvency requirements will flourish in the evolving landscape. The growth in the number of active policies issued indicates strong market demand.
Explore chapterEnergy
Abu Dhabi’s ongoing transition from a fossil fuel-dependent economy to one driven by clean energy marks a significant shift. Hosting the Arab world’s first nuclear power plant and the largest single-site solar power plant, the emirate plays a pivotal role in this transition. While hydrocarbons remain integral to the broader UAE’s economy, global energy shifts and geopolitical tensions have increased the importance of natural gas. Despite a potential economic slowdown in 2023-24, the UAE’s hosting of the COP28 UN Conference on Climate Change opens new doors for the energy sector, fostering strategic partnerships and investment. Unconventional gas and blue and green hydrogen are key growth avenues, driving collaboration in production, storage, transport and related technologies for cleaner energy alternatives. This chapter includes an interview with Awaidha Murshed Al Marar, Chairman, Department of Energy.
Explore chapterUtilities
Abu Dhabi’s ambitious energy transition, accelerated by the Barakah Nuclear Energy Plant’s commercial operations, aligns with the UAE Energy Strategy 2050. This strategy aims to balance energy sources, targeting 44% clean energy, 38% natural gas, 12% clean coal and 6% nuclear. Amid efforts to catalyse substantial investment in clean and renewable energy, Abu Dhabi is expected to play a leading role. The emirate prioritises upgrading utilities infrastructure with sustainability in mind, inviting partners in areas such as smart grids, renewable power, water infrastructure and energy efficiency. Nuclear and thermal power stakeholders are also finding opportunities as Abu Dhabi seeks to meet the demands of a growing population. The sector’s consolidation under major players is simplifying project implementation, with foreign companies competing for operations contracts under the build-own-operate-transfer model. This chapter contains interviews with Jasim Husain Thabet, Group CEO and Managing Director, Abu Dhabi National Energy Company; and Khalid Al Marzooqi, CEO, Tabreed.
Explore chapterTransport
Abu Dhabi’s transport sector is an important driver of economic growth. The completion of stage two of the Etihad Rail network and the imminent opening of a new terminal at Abu Dhabi International Airport are among the sector’s key milestones. This sector has experienced significant gains, with tourism and commercial activities rebounding in the wake of the Covid-19 pandemic. Abu Dhabi continues to pioneer innovative solutions, such as autonomous vehicles, water taxis and artificial intelligence-driven traffic management, aimed at easing congestion and reducing pollution. However, the deployment of advanced technologies also presents regulatory and partnership challenges. Navigating these hurdles will require agile regulators and robust public-private collaboration. Innovation not only benefits Abu Dhabi residents, but also offers valuable insights for observers around the world who are keen to learn from the emirate’s experiences in pioneering modern transport solutions. This chapter contains interviews with Mohamed Ali Al Shorafa, Chairman, Abu Dhabi Department of Municipalities and Transport; and Mohamed Juma Al Shamisi, Managing Director and Group CEO, AD Ports Group.
Explore chapterIndustry & Retail
The Covid-19 pandemic exposed global supply chain inefficiencies, affecting manufacturing and retail alike. Abu Dhabi, as well as the broader UAE, is applying lessons from this era and focusing on self-sufficiency and local supply chains. This approach strengthens local retail and wholesale operations, which are adapting to the 5% value-added tax introduced in 2018. At the same time, enhanced governance, services and investment regulations are helping to encourage foreign direct investment in manufacturing. As conglomerates navigate industrial trends, opportunities for small and medium-sized enterprises (SMEs) in national value chains are growing, benefitting the manufacturing segment, investors and SME ecosystem development. Abu Dhabi’s expanding e-commerce industry also offers growth potential, supported by the Tajer Abu Dhabi scheme. The transition to renewable energy aligns with development goals and appeals to global businesses seeking robust environmental, social and governance policies, while improved trade relations are enhancing the growth potential of Abu Dhabi’s manufacturing and retail sectors. This chapter contains an interview with Sultan Al Jaber, UAE Minister of Industry and Advanced Technology.
Explore chapterSecurity, Aerospace & Defence
Abu Dhabi holds a central role in military and defence operations in the UAE, attracting multinational aerospace manufacturers and service providers. The emirate’s focus on cybersecurity, advanced robotics and autonomous vehicles is driving international research and manufacturing partnerships. Educational programmes, meanwhile, aim to equip the local talent pool for emerging opportunities. Collaborative efforts between the public and private sectors are enhancing investor confidence, driven by expanding military manufacturing and international trade relations. Increased federal defence spending and the drive to localise production further are expected to bolster these high-value sectors, aligning with Abu Dhabi’s goal to establish itself as a regional and global centre for advanced manufacturing and technologies. This chapter includes interviews with Salem Butti Al Qubaisi, Director-General, UAE Space Agency; and Faisal Al Bannai, Chairman, EDGE Group.
Explore chapterReal Estate & Construction
Abu Dhabi’s real estate and construction sectors performed well in 2022, contributing significantly to the emirate’s non-oil growth. Construction expanded by 7.6%, reaching Dh86bn ($23.4bn), or 7.8% of Abu Dhabi’s total GDP. At the same time, the real estate market witnessed an 8.5% increase in transaction values and a 27.2% rise in transaction volumes, reflecting strong market activity. Several anticipated real estate projects are under way, bolstering the market’s international appeal and adding to supply forecasts for the coming years. Business confidence remains high, creating an environment conducive to further investment in the sector. Opportunities abound in both the residential and commercial segments, driven by a robust project pipeline, increased foreign direct investment, infrastructure development and the resurgence of tourism. This outlook reflects a dynamic market catering to diverse preferences, benefitting investors, developers and residents. This chapter contains interviews with Hamad Hareb Al Muhairi, Director-General, Abu Dhabi Housing Authority; Majed Odeh, CEO, Q Holding; and Talal Al Dhiyebi, Group CEO, Aldar Properties.
Explore chapterAgriculture & Food Security
Abu Dhabi, occupying 84% of the UAE’s landmass, plays a crucial role in agriculture and food security. The emirate is investing significantly in strengthening supply and value chains to enhance food-production systems and meet the population’s nutritional needs. The Covid-19 pandemic and global geopolitical tensions have prompted a re-evaluation of food security strategies, emphasising localised supply chains. Abu Dhabi is central to this discussion, given its resources and geographic location. The agriculture sector is undergoing transformation, driven by collaboration between public and private entities, which presents opportunities for international investors, aided by improvements in investment legislation. The emirate’s focus on agri-tech development offers an opening for start-ups to contribute to sector growth. This chapter includes an interview with Saeed Al Bahri Salem Al Ameri, Director-General, Abu Dhabi Agriculture and Food Safety Authority.
Explore chapterICT
Abu Dhabi is poised for deeper integration of advanced technologies in government and business processes. With advanced digital infrastructure and high global rankings in digital readiness, the emirate is at the forefront of digital transformation. To attract private investment, federal and emirate-level authorities are implementing advanced digital government services, enhancing transparency and efficiency. Funds and incentive packages support technology start-ups and robust regulatory frameworks inspire investor confidence, while Abu Dhabi’s focus on 5G and 6G innovation enhances its global appeal. This chapter features an interview with Peng Xiao, Group CEO, G42; and Ali Al Hashemi, Group CEO, Yahsat.
Explore chapterEducation & Research
Education and research hold pivotal roles in Abu Dhabi’s broader development effort. The emirate is committed to enhancing human capital through curriculum redesign, increased research and innovation capacities, and technology integration in the education sector. Recent initiatives and partnerships have channelled expertise and funding into specific educational areas, bolstering Abu Dhabi’s regional and international reputation in the education sector. Advancements in technology are opening new avenues for investment and development, positioning Abu Dhabi as a global leader in education. The emirate’s continued progress in international attainment tests reflects its ambition to contribute significantly to economic expansion by nurturing a highly skilled workforce and fostering innovation through education and research. This chapter includes an interview with Sarah Al Amiri, Minister of State for Public Education and Advanced Technology.
Explore chapterHealth
Abu Dhabi’s health care sector is flourishing, contributing progressively to the emirate’s GDP growth. Government strategies and initiatives aim to attract more private investment, resulting in the establishment and strengthening of international health care stakeholders, specialised facilities, pharmaceutical manufacturers and research entities in Abu Dhabi. Recent changes in mandatory health insurance regulations have been implemented to improve the business environment in Abu Dhabi. The health care sector offers an attractive investment destination, with opportunities across various specialties, including logistics, manufacturing, medical technologies, and the development of hospitals and health centres. While challenges remain in managing non-communicable and lifestyle-related diseases, the emirate’s proactive policies are expected to address these issues and further boost the health care sector’s contribution to Abu Dhabi’s socio-economic development and prosperity. This chapter contains an interview with Mansoor Ibrahim Al Mansoori, Chairman, Department of Health.
Explore chapterTourism & Culture
Abu Dhabi’s tourism industry witnessed substantial growth in the years leading up to the Covid-19 pandemic. The economy was insulated by government policies and relief packages during the crisis, with effective measures implemented to control the virus’s spread. Today, Abu Dhabi’s tourism operators are experiencing a resurgence in international visitors, marking a strong recovery for the sector. Tourism and cultural activities remain central to Abu Dhabi’s economic diversification efforts, with various investment initiatives aimed at expanding the emirate’s range of leisure and cultural attractions. These endeavours, coupled with the sector’s capacity for job creation, have been largely successful to date. Continued growth in tourist arrivals is expected as Abu Dhabi’s cosmopolitan image, along with substantial public and private investment, positions the emirate to capitalise on the increasing international recognition of the region’s cultural and leisure offerings. Abu Dhabi’s reputation as a welcoming, safe and diverse destination with robust international connectivity bodes well for future expansion. This chapter contains interviews with Mohamed Khalifa Al Mubarak, Chairman, Department of Culture and Tourism – Abu Dhabi; and Mohamed Abdalla Al Zaabi, Group CEO, Miral.
Explore chapterTax
Abu Dhabi and the broader UAE have established themselves as attractive destinations for business and foreign investment, due in large part to their globally competitive tax regulations. The UAE remains committed to maintaining a business-friendly economy aligned with international best practices and has proactively adapted to rapid changes in global tax legislation over the past decade. The implementation of updates, such as those in line with the OECD Base Erosion and Profit Shifting actions, underscores its dedication to remaining in compliance with international tax standards. This enhances the country’s appeal as a stable and attractive destination for businesses and investors seeking tax efficiency and transparency. This chapter contains a viewpoint with Emilio Pera, CEO and Senior Partner, KPMG Lower Gulf.
Explore chapterThe Guide
This chapter contains selected listings of some of the country’s top hotels, contact details for embassies, ministries and organisations, helpful tips for business and leisure travellers, and other useful suggestions for travel to Abu Dhabi.
Explore chapterTable of Contents
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Sheikh Mansour bin Zayed Al-Nahyan, Vice-President and Deputy Prime Minister of the UAE; and Minister of the Presidential Court of the UAE
Ahmed Jasim Al Zaabi, Chairman, Abu Dhabi Department of Economic Development; and Chairman, Abu Dhabi Global Market
Hamad Al Ameri, Managing Director, Alpha Dhabi Holding
Khaled Mohamed Balama, Governor, Central Bank of the UAE
Jasim Husain Thabet, Group CEO and Managing Director, Abu Dhabi National Energy Company
