OIL INDUSTRY IN UAE

Oil Industry In United Arab Emirates

Oil Industry In United Arab Emirates

Introduction

The economic development in the United Arab Emirates can be divided into three eras: before 1962 oil exports, after the union establishment and oil prices boost of 1973, and late nineties up to current days. In the first period, all the revenues were coming from pearl production, herding, agriculture and fishing. However, the second period was dominated by oil industry especially after the rise of oil prices in 1973. But this didn't persist for a long time, and some other factors played a vital rule in pushing forward the country's economy growth. Since 1973, the UAE has undergone a profound transformation from an impoverished region of small desert principalities to a modern state with a high standard of living. In recent years, the UAE has undertaken several projects to diversify its economy and to reduce its dependence on oil and natural gas revenues. But it's still expected that oil and gas reserves should last for over 100 years, at the current production rates.( Abraham, 2005:126)

The United Arab Emirates have been spent fostering unified and stable political structures capable of adapting to dramatic social change; building diversified economy which is less dependent on fluctuating oil revenues; raising from the desert sands a comprehensive infrastructure of cities, houses, schools, hospitals highways, and telecommunication facilities; successfully mounting a green revolution in terms of agriculture, tree-planting and general landscaping, as well as providing world-class education, health and social services to a burgeoning population. Leisure and sporting facilities have also developed apace, allowing the country's residents to enjoy their newfound prosperity to the full.

UAE's economy is going ahead in leaps and bounds, and it's one of the star performers of the Middle East. That's because it did not depend on oil exports only, but it was amplified by a booming private sector, and a variety of industries and investments. UAE's oil revenues are accounting for less than third of the national Gross Domestic Product these days. The role of the oil economy is now clearly about one-third even during periods of oil price booms, as compared to more than one-third during the late eighties and early nineties, and almost one half during the seventies.( Abraham, 2005:128)

Discussion

The non-oil sectors of the UAE's economy presently contribute around 70 percent of the UAE's total GDP, and about 30 percent of its total exports. The federal government has invested heavily in sectors other than gas and oil, such as aluminum-related products manufacturing, aviation, re-export commerce, telecommunications, and recently High-class tourism and international finance. As part of its strategy to further expand its tourism industry, the UAE is building new hotels, restaurants and shopping centers, and expanding airports and duty-free zones. Meanwhile, non-oil economy continues to expand at a steady rate, and is strengthened by the growth of the oil economy. A measure of the expansion in the non-oil economy can be made from the increase in the working population, which has been increasing at roughly ...