x Abu Dhabi, UAEFriday 28 July 2017

A steady course amid economic uncertainties

The new year, like the last one, will surely have some shocks. But the UAE is on a firm footing to continue making solid progress.

Another year comes and goes. Amid the political turmoil of the recent past, which has contributed to a regional economic malaise that we address in these pages today, the UAE has been a remarkable exception of stability and continued economic development. That stability has been reassuring, not just for citizens who have benefited from the country's enormous growth in the past few decades, but also for expatriate residents who contribute to the national economy and rely on the UAE for employment and their way of life.

These have not been an easy few years - the global economic crisis, stemming from the United States in 2008, set the stage for a very uneven recovery that is even now not assured. The Arab uprisings that swept out of North Africa in the beginning of 2011 have fundamentally changed regional politics.

These trends, and of course the uncertainties of the future, continue into 2013. The global economic climate is far from tranquil after the earlier storm. The "fiscal cliff" debate in the United States of recent weeks has again highlighted how the world's largest economy is hostage to narrow political interests. A failure in Washington would have reverberations across the world. The euro zone, too, is struggling to reach an agreement about how to deal with crippling levels of sovereign debt. The old canard that the global economy can be powered exclusively by growth in China and India, as well as other developing economies, seems more and more like wishful thinking. And, of course, there is the truism that any wise long-term planning must be able to accommodate uncertainty.

The UAE's track record here is unquestionably strong. Certainly, the country was buffeted by the financial crisis, but the fundamental strengths were never in doubt. The UAE's position as a major energy exporter has assured an economic resilience; even amid the uncertainty, major development project such as Khalifa Port and the Khalifa Industrial Zone Abu Dhabi marked major milestones. Remarkably, the UAE ranked 24th out of 144 countries globally in the Global Competitiveness Report of 2012-2013 released last year.

It is that competitiveness, and the country's ability to leverage its wealth for development, that will determine the strength of the UAE economy in the coming decades. No one can predict what 2013 will hold. But this country has a unique position to build on its foundations and continue its economic diversification, come what may.