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 Located
in the south-east corner of the Arabian peninsula,
the seven emirates, formerly known as the ‘Trucial
States’, were in treaty relations with Britain
for 150 years. With the announcement by the British
that they would be withdrawing from the region
in 1971, the rulers of the emirates, led by the
UAE’s founding father, the late Sheikh Zayed bin
Sultan Al Nahyan, decided to form a federation,
to work together to bring prosperity and development
to their people. Aided by the vision of Sheikh
Zayed, who believed that the revenues from the
oil and gas resources of his own emirate, Abu
Dhabi, should be put to use in the service of
the inhabitants of the country as a whole, the
UAE has subsequently emerged as one of the fastest-growing
and most stable countries in the Middle East region.
Sheikh Zayed himself died in 2004, after over
thirty years as President. The process of growth,
however, has continued under the leadership of
his son and successor as President, His Highness
Sheikh Khalifa bin Zayed Al Nahyan, the Vice President
and Prime Minister and Ruler of Dubai, His Highness
Sheikh Mohammed bin Rashid Al Maktoum, their fellow
members of the UAE’s Supreme Council of Rulers
and the Crown Prince of Abu Dhabi and Deputy Supreme
Commander of the UAE Armed Forces, His Highness
Sheikh Mohammed bin Zayed Al Nahyan. Despite the
vicissitudes of the global economy in recent years,
the programme of development is still firmly under
way.
The guiding principles that underlie the success
of the state, originally laid down 40 years ago,
remain fundamental elements in the policies of
the UAE’s Government. One was that the resources
deriving from Abu Dhabi’s oil and gas should be
shared across the country in the development of
its infrastructure. A second was that, as Sheikh
Zayed put it, ‘the country’s real wealth is its
people’, and that, in consequence, particular
effort should be made to ensure that they should
benefit from the best available access to education,
health care and social services, to equip them,
both men and women, to play their full part in
the country ’s growth. Today, women account for
around 70 per cent of all university graduates
in the country and fill around two thirds of government
jobs, providing four members of the Cabinet, ambassadors
and even air force pilots, evidence of the country’s
success in empowering its women.
A third principle, in recognition of the fact
that the UAE was a country that would attract
people of many nationalities, was that it should
be a country where a spirit of tolerance between
those of different communities and faiths should
prevail, yet one where its own national culture
and heritage should be both cherished and protected.
Although firmly committed to the Islamic faith
of its citizens, the UAE is now home to over 40
churches and cathedrals as well as to places of
worship for other faiths.
And the fourth principle, looking outside the
country, was that the UAE was to seek to promote
dialogue, co-operation and the resolution of conflicts,
both within the Arab world and the broader Islamic
community and within the wider international community.
Over the course of the past year, important steps
have been taken, both at home and abroad, in the
further implementation of those principles. In
both areas, the continuity in policy is notable.
Indeed, that continuity has been crucial in the
UAE’s progress over the last forty years.
In 2011, a year when dramatic nd often violent
change has rocked much of the Arab world, as peoples
eek Governments that are more esponsive to their
economic, social nd political needs, the United
Arab mirates has been able to continue n a steady
path of evolutionary evelopment. Thus, for example,
in September, an important step orward was taken
in the widening of popular participation in the
process of government, through an expansion of
the electorate for the country’s parliament, the
Federal National Council from under 7,000 to 129,000,
representing almost 30 per cent of the potential
electors. While participation in the elections
themselves was smaller than had been anticipated
– an indication of a broad degree of satisfaction
with the current system – plans are now being
drawn up for an extension of the powers of the
FNC itself, while its members set about the important
task of serving as elected representatives of
the country’s citizens at large.
Meanwhile, Government displayed its continued
commitment to the upgrading of the social and
economic infrastructure of the smaller emirates
which, unlike Abu Dhabi and Dubai, lack resources
derived from oil and gas revenues and from thriving
commercial and tourism sectors sufficient to be
able to finance their own growth. Following an
extensive tour of these emirates early in the
year by the Crown Prince of Abu Dhabi, HH Sheikh
Mohammed bin Zayed, designed to identify the most
urgent needs for investment, President HH Sheikh
Khalifa bin Zayed ordered an immediate allocation
of Dh 5.7 billion (around US$ .55 billion) for
expansion of the water and electricity network
and for upgrading of the local health care services
and of housing for UAE citizens. As the implementation
of these instructions got under way, further areas
for investment were also identified, funded both
by the Government of Abu Dhabi and by the federal
UAE Government.
This is, of course, a process that will take
some time to complete. While the UAE’s annual
budgets have always been heavily focused on the
provision of services, the provisional federal
budget for the year 2012, issued in October, included
increased allocations for development expenditure.
Within the overall budget, amounting to Dh 41.4
billion (US$11.2 billion), the social services,
including health care, education and housing,
accounted for 47 per cent of the total. Of this
education, including higher education, will receive
Dh 8.26 billion (US $ 2.25 billion) or 19.6 per
cent, the bulk of which will be spent on plans
to build new schools and other educational institutions
and to upgrade the educational environment. A
further Dh 5 billion (US $ 1.36 billion) is allocated
to the Federal Water and Electricity Authority,
to permit continued expansion of the Authority’s
networks in Ra’s al-Khaimah, Ajman, Umm al-Qaiwain
and Fujairah. Power and water projects in the
other emirates continue to be funded by the local
Governments.
The budget also offers evidence of the success
of a longstanding policy that the federal Government
should make progress towards being able to fund
its own programmes, with revenues from fees and
services being expected to raise around Dh 25.5
billion (US$6.9 billion) or just over 61 per cent
of the total budget. This has been achieved despite
the fact that the UAE remains, with a few exceptions,
a tax-free economy and one, moreover, where there
are no controls on the inflow or outflow of capital
or profits, in line with keeping the country a
free market economy.
Naturally, the revenues from oil and gas production
continue to provide an important contribution
to the national economy.
With the fourth largest oil reserves in the world
and with a production rate of around 2.5 million
barrels a day, primarily from Abu Dhabi, as well
as the fifth largest gas reserves in the world,
the UAE remains one of the world’s largest producers
of hydrocarbons. A large-scale investment programme
is under way to increase sustainable production
capacity of both onshore and offshore oilfields
in Abu Dhabi while during the course of 2011 work
proceeded according to schedule for the bringing
on stream of new oilfields both in Abu Dhabi and
in Dubai.
The success of a longstanding programme to diversify
the sources of national income, however, has meant
that oil and gas revenues now account for only
about thirty per cent of Gross National Product,
despite relatively high oil prices. Tourism, a
rapidly growing sector, now accounts for well
over 10 per cent of GDP, with over 12 million
visitors a year making their way to the country,
stimulating continued growth in the country’s
national airlines, in particular Abu Dhabi’s Etihad,
Dubai’s Emirates and FlyDubai and Sharjah’s Air
Arabia. The country’s seaports, too, are contributing
to the growth of the tourism sector, attracting
dozens of cruise liners a year, although the more
conventional seaborne trade and commerce continue
to account for most of the UAE’s shipping business,
along with marine bunkering, where the East Coast
port of Fujairah is now the second largest bunkering
port in the world.
Another indication of the health of the local
economy is provided by its non-oil foreign trade,
which rose by 14 per cent in 2010, to Dh754.4
billion (US$ 05.3 billion), compared to 2009.
Exports rose by 27 per cent and re-exports by
26 per cent, with non-oil imports rising only
by 8 per cent. Foreign trade has continued to
rise in 2011.
Another important sector, construction, which
employs over half of the total labour force, has
begun to recover from the sharp downturn in 2008
and 2009 that occurred as a result of the first
phase of the current global economic crisis. Meanwhile,
as growth in the financial and services sector
resumes, the country’s industrial sector has continued
to grow, both in the downstream sector of the
oil and gas industry and in other areas, with
the huge EMAL aluminium smelter in the Khalifa
Industrial Zone, north-east of Abu Dhabi, coming
on stream during the course of the year. Other
new industries in the Zone are due to be completed
in the next few years.
While there has, naturally, been a focus by Government
on the continued improvement of social services
and on the expansion of those sectors of the economy
which will make the greatest contribution to the
creation of employment for young Emiratis, both
men and women, the need to focus on other areas
of national life has not been overlooked. Work
continued during the year on plans for the development
of the Sheikh Zayed National Museum of the island
of Sa’adiyat, adjacent to Abu Dhabi city. One
of several major museums, including a Louvre and
a Guggenheim, being planned, it will form the
centrepiece of a new cultural complex that is
expected to attract visitors in their thousands
from overseas. Attention has also continued to
be paid to the protection of the UAE’s fragile
environment, this, together with cultural heritage,
being considered to be important components of
the country’s national identity.
While pressing ahead with its own programme to
develop peaceful uses of nuclear energy, in accordance
with the relevant international guidelines on
controls and inspection, so as to meet its needs
for power generation, the UAE is also emerging
as a leader in research into sustainable energy.
Abu Dhabi, the headquarters of the international
Renewable Energy Agency, IRENA, is also home to
Masdar City, designed to be one of the world’s
first carbon-neutral cities.
While the increasingly well-trained Emirati workforce
is playing a growing role in all of these developments,
the pace of growth over the last year, as has
been the case since the foundation of the federation
forty years ago, has been such that there has
always been, and will continue to be, an important
role to be played by expatriate residents, who
come from over 200 different countries. It is
the intention of Government that these expatriates
should be afforded all of their due rights in
terms of security and employment. Recognising
that there have in the past been cases of abuse
of employment, particularly in the construction
sector, the UAE’s Ministry of Labour, with the
support of the International Labour Organisation,
ILO, has continued its efforts during the course
of the year to negotiate and to implement a series
of agreements with major labour supply countries
so that such abuses are eliminated.
Another programme to protect the rights of expatriates,
again with the support of the relevant international
organisations, has involved the stepping up of
efforts by the police and other bodies to identify
and to arrest those responsible for human trafficking,
a practice that the UAE is determined to eliminate.
The recently-passed Law No. 51 is the first in
the region designed to confront the issue.
In the field of foreign affairs, the last year
has posed new challenges, particularly within
the Middle East region. Pressure for change has
led to considerable instability that continues
as the year draws to a close, with the UAE calling
for those countries that have undergone changes
in government, like Egypt and Tunisia, to be supported
in their endeavours to achieve security, social
and economic development and stability.
In line with its traditional policy of seeking,
through collective action, to offer support for
people in countries suffering from conflict, the
UAE played an active role in the UN-approved aerial
campaign to protect civilians in Libya from the
impact of the conflict in that country as well
as providing substantial humanitarian assistance
for those affected. Elsewhere, it has also called
for an end to bloodshed in Syria and for the carrying
out of meaningful political reforms that reflect
the aspirations of its people.
Nearer to home, the UAE, along with other member
states of the Gulf Co-operation Council, GCC,
provided support to GCC member Bahrain, denouncing
foreign intervention in its affairs and supporting
steps taken to promote dialogue within the country,
and also was actively engaged in attempts to negotiate
a peaceful resolution of conflicts in Yemen.
In a speech to the United Nations General Assembly
in September, the UAE Minister of Foreign Affairs,
His Highness Sheikh Abdullah bin Zayed Al Nahyan,
noted that: “my country undertakes extensive preventive
diplomatic efforts in order to contain tensions
and disputes occurring in the surrounding areas
and beyond. The UAE vigorously seeks to promote
direct and indirect humanitarian relief and development
and economic aid, with a particular focus on those
countries with situations of conflicts or natural
disasters, in addition to its other effective
contributions in peacekeeping operations, protecting
civilians, and re-building efforts for states
which have just emerged from violent armed conflicts.”
A good example of that approach has been the
UAE’s involvement in the multi-lateral force in
Afghanistan, where, besides working to improve
security in the country, the UAE has also provided
over US$1.5 billion dollars over the last decade
for rehabilitation and reconstruction programmes
In the Arabian Gulf itself, the UAE, with widespread
international support, has continued its efforts
to persuade Iran to resolve the issue of the occupation,
since 1971, of the UAE’s three islands of Abu
Musa and Greater and Lesser Tumb, through bilateral
negotiations or through referral to the International
Court of Justice. Unfortunately, as Sheikh Abdullah
noted in his address to the UN, Iran has remains
opposed to all efforts to reach a peaceful, just
and permanent solution.
In the broader Middle East, the UAE expressed
its support for the Palestine Authority in its
attempt to obtain membership of the United Nations,
in accordance with long-standing UAE backing for
a settlement of the Israel-Palestine issue based
on the relevant international resolutions and
the Arab peace initiative that will lead to a
just and lasting peace and to the establishment
of a Palestinian state with Jerusalem as its capital.
Expressing regret in his UN speech at the failure
to make progress in peace talks, “due to the intransigent
stance taken by the Israeli government,” Sheikh
Abdullah noted that: “the UAE is deeply concerned
at the deteriorating conditions of the Palestinian
people, who are suffering from deprivation as
a result of the continued occupation of their
land… and the frequent aggressions and violations
committed against their inalienable rights under
international law” adding that the UAE, in particular,
condemned Israel’s settlement policy in the Palestinian
territories.
As noted earlier, the UAE has made a practice,
since its establishment in 1971, of providing
assistance to those in need because of conflicts
and natural disasters. Through the UAE Red Crescent
Authority and a number of other bodies, including
the humanitarian funds established by the President
and Vice President, emergency assistance worth
several hundred million dollars has been sent
during the year to many countries, including Pakistan,
Somalia and Thailand, suffering from droughts,
flooding and famine. Other aid has been provided
by bodies such as the Abu Dhabi Fund for Development
and Dubai Cares to support development programmes,
both in terms of infrastructure and the financing
of educational and health care programmes. Recipients
include a wide range of countries, from Egypt,
Gaza and the West Bank in the Middle East to the
Seychelles and the South Pacific.
Another area in which the UAE has been active
is in efforts to counter maritime piracy, particularly
in the north-west Indian Ocean and the Arabian
Sea, where the UAE Navy has been working with
other forces to protect shipping.
As Foreign Minister Sheikh Abdullah bin Zayed
noted, however, in a speech to the Summit on the
Global Agenda, held in Abu Dhabi in October: “it
is clear that the traditional model that treats
piracy purely as a security issue needs to be
updated to ensure military and political efforts
aimed at confronting it can be more effectively
coordinated. The UAE believes that, in addition
to counterpiracy efforts taking place at sea,
the promotion of social and economic development
initiatives on land are equally important if we
are to address this issue in a lasting way.”
“What is becoming clear,” he said, is that “the
nature of the challenges the world faces today
requires the development of new models, or the
adaptation of traditional ones, if they are to
be addressed effectively.”
Recalling that over 900 million people were affected
by famine and chronic hunger in 2010, he added
that the issue of food security could not be effectively
addressed without tackling the need for security
of water supplies. A similar holistic approach
needs to be taken on counter-terrorism, he said,
citing the UAE’s view that the violent ideologies
feeding terrorism around the world are also in
part based on an absence of hope and the exploitation
of economic disadvantage in vulnerable communities.
Both at home and within the wider world, the
UAE has faced numerous challenges over the course
of the last year. As has been the case over the
last four decades, it has continued to tackle
them within the framework of the guiding principles
laid down by its founding father, Sheikh Zayed.
His strategy of seeking to make steady, consistent
progress, based upon consultation and consensus
that derived its legitimacy from the consent of
the people, has proved its worth since 1971.
As the UAE enters into its fifth decade, it is
confident of making further progress, both at
home and on the world stage, in the years to come.
(Emirates News Agency,
WAM)
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