Economy
From The Report: Abu Dhabi 2017
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Economies around the Gulf region have faced a challenging economic environment since the second half of 2014, but a more optimistic outlook for international oil prices in 2017 has offered some welcome relief. The process of fiscal reform that the oil price decline precipitated is, however, set to continue. The restructuring of Abu Dhabi’s public finances has taken into account the federal government’s decision to reduce subsides, as well as the introduction of new fees and taxes by the emirate, and their affects have been felt by nationals and expatriates alike. In the meantime, Abu Dhabi’s ambitious plans to broaden the range of economic activity in the emirate have been granted greater clarity with the publication of the latest iteration of its development strategy in 2016.

This chapter contains interviews with Ali Majed Al Mansoori, Chairman, Abu Dhabi Department of Economic Development; Khaldoon Khalifa Al Mubarak, CEO, Mubadala Investment Company; and Liam Fox, UK Secretary of State for International Trade.

Articles from this Chapter

Overview

Going strong: A solid foundation is the basis for the emirate’s continued growth
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Economies around the Gulf region have faced a challenging economic environment since the second half of 2014, but a more optimistic outlook for international oil prices in 2017 has offered some welcome relief. The process of fiscal reform that the oil price decline precipitated is, however, set to continue. The restructuring of Abu Dhabi’s public finances has taken into account the federal government’s decision to reduce subsides, as well as the introduction of new fees and taxes by the…

Interview

Policy focus: Ali Majed Al Mansoori, Chairman, Abu Dhabi Department of Economic Development (ADDED), on enabling the private sector
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Interview: Ali Majed Al Mansoori How have innovative practices been applied to help facilitate and encourage growth? ALI MAJED AL MANSOORI: Abu Dhabi has done a great deal to ensure innovation is catered to and included in the emirate’s various strategic objectives, and we encourage active involvement from the private sector. ADDED is mandated to support and supervise the development of science, technology and innovation, mainly through functioning as the interface between government, businesses…

Analysis

Think big: A new five-year plan aims to expand on previous successes and create new ones
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The emirate’s latest five-year plan, the Abu Dhabi Plan, was revealed in June 2016. Of key interest to the business community was how the new strategy would differ from the Strategic Plan 2011-15. Variations from one five-year plan to another are bound to be relatively minor, as each strategic phase works towards the objectives already established by the Abu Dhabi Economic Vision 2030, published in 2008. However, changes in emphasis are of great interest, as they indicate which areas of…

Interview

Long-term prosperity: Khaldoon Khalifa Al Mubarak, CEO and Managing Director, Mubadala Investment Company, on diversification and integration
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Interview: Khaldoon Khalifa Al Mubarak How does the Mubadala Investment Company merger accelerate economic diversification? KHALDOON KHALIFA AL MUBARAK: Mubadala was created in 2002 to support the vision of the UAE’s founding father, the late Sheikh Zayed bin Sultan Al Nahyan, who believed that sustainable development and a diversified economic base were vital to Abu Dhabi’s long-term prosperity. Over its 14-year history, Mubadala’s role has been to strengthen the emirate’s position in…

Interview

Strengthening ties: Liam Fox, UK Secretary of State for International Trade, on navigating trade relations post-Brexit
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Interview: Liam Fox How is the UK looking to develop trade with countries of the GCC in the post-Brexit environment? LIAM FOX: As we begin the process of leaving the EU, the UK will look to build stronger trading relationships with countries around the world, promoting the benefits of free trade, supporting UK companies to export and attracting inward investment. As part of this work, Theresa May, the UK prime minister, announced a working group on trade and investment between the UK and the GCC…

Analysis

By the book: The emirate commits to implementing a procyclical fiscal policy
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Both the federal government of the UAE and the government of Abu Dhabi have done much to cut expenditure since 2015. However, with the medium-term outlook suggesting that the fiscal breakeven price will remain above the projected oil price and the emirate set on diversifying its economy in line with the Abu Dhabi Economic Vision 2030, the need for yet more fiscal consolidation is evident. The UAE has also set itself the target of further narrowing the non-hydrocarbons fiscal deficit to 8.6%…

Analysis

Introduction of a new tax is set to bring in more state revenue: Adding value
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The February 2016 announcement by Obaid Humaid Al Tayer, the UAE minister of state for financial affairs, that the UAE will introduce a value-added tax (VAT) is one of the most significant economic developments in the country in recent years. While the UAE has been a strong proponent of VAT for some time, the prospect of reducing the competitiveness of its economy with unilateral implementation has long been a stumbling block to the introduction of the tax. After years of speculation, in…