x

Abu Dhabi, UAETuesday 19 June 2018

Abu Dhabi’s journey towards celebrating the last barrel of oil gathers pace

While Sheikh Mohammed bin Zayed's new plans are a game changer, the diversification of the capital’s economy has been in the making for decades 

Abu Dhabi is the city that oil built, but its continuing prosperity depends on an economy that is diversified into many fields.

That vision was elegantly expressed by the Crown Prince and Deputy Supreme Commander of the Armed Forces, Sheikh Mohammed bin Zayed, in an address to the Government Summit three years ago.

“In 50 years, when we might have the last barrel of oil, the question is: when it is shipped abroad, will we be sad?” he asked. “If we are investing today in the right sectors, I can tell you we will celebrate at that moment.”

There were celebrations too, fifty years early, when a BP tanker sailed with the first shipment of oil from Abu Dhabi.

On Tuesday evening, Sheikh Mohammed announced a massive Dh50 billion stimulus package for Abu Dhabi as well as ten initiatives which will help accelerate the non-oil economy over the next three years.

Decades ago, it was initially the rapidly growing revenues from oil that propelled Abu Dhabi from a sleepy fishing village to one of the world’s fastest growing cities.

A five-year plan implemented by Sheikh Zayed in 1966 saw a metropolis rising literally out of the sands. Roads, houses, hospitals, shops, offices — all were constructed in a few years as the population rose from a few thousand to hundreds of thousands.

The economic engine of all this was oil, with the creation of the UAE in December 1971 bringing the benefits of Abu Dhabi’s bounty to all corners of the country.

By the 1990s, though, it was clear that the age of oil, if not over yet, was likely to have an end point.

Following the death of Sheikh Zayed in 2003 and the election of Sheikh Khalifa bin Zayed as President of the UAE, fresh ideas were applied to the future of Abu Dhabi. Oil would still play a major role, but as the generator of new sectors of the economy that would grow and thrive into the 21st Century.

Some of those changes have become household names, not just in the UAE but around the world. Etihad Airways was launched in 2003 with the model of making Abu Dhabi a global aviation transport hub.

The airline has seen spectacular expansion worldwide and next year should see the opening of the new Midfield Terminal, a fitting home for an airline that has won an armful of awards for the quality of its service.

________________

Read more:

Sheikh Mohammed bin Zayed announces Dh50 billion stimulus for Abu Dhabi

Why Sheikh Mohammed's new economic plans are a game changer for Abu Dhabi

New housing plans will help make Abu Dhabi 'number one globally' for home ownership

________________

As ambitious was the concept of reinventing Abu Dhabi as a cultural hub. In the city, Saadiyat Island was designated as the site of a new cultural district, with three museums, the first of which, Louvre Abu Dhabi, opened last year.

To further boost the tourist industry, a series of luxury resort hotels, including the Park Hyatt and St Regis were built along the Gulf coast of Saadiyat.

On another island, the Yas Marina F1 track placed Abu Dhabi firmly on the international sporting circuit, with the Ferrari World theme park another draw for visitors and helping to create a critical mass for tourism.

Beyond the metropolis, Sir Bani Yas, the offshore retreat of Sheikh Zayed, was reimagined as a safari park and real-life desert island, while a five-star hotel, Qasr Al Sarab, was opened out in the dunes of the Liwa.

All these projects signalled Abu Dhabi’s intent to make its voice heard around the world, to present a more diversified image than the clichés of Opec and camels. The acquisition of Manchester City by Sheikh Mansour bin Zayed in August 2008 and the column inches it generated, introduced the emirate to a global audience who previously might have previously struggled to locate it on the map.

This concept of “Brand Abu Dhabi” — which included the launch of The National in 2008 as an articulate voice to express and explain these ambitions — went far wider and deeper than five star resorts or roller coasters.

If anything, it signals the commitment to life beyond oil, it is the Masdar Institute of Technology where cutting edge research is carried out on alternative energy sources, with investment for solar and wind farms from rural Morocco to the Thames Estuary near London.

Part of this strategy is to create a highly skilled and educated workforce best able to compete in these new industries, which form part of what is increasingly described as the “Fourth Industrial Revolution.”

The opening of New York University Abu Dhabi in 2010 showed the potential to match the highest international standards of academic study and research, and an intellectual boot camp for young Emirati minds and future leaders.

Mubadala, the investment company for sovereign wealth, was created in 2002, with the goal of investing in human capital as well as research and develop in other projects.

Mubadala’s portfolio includes Strata, in Al Ain, where aircraft components, including parts for Airbus, a built using a highly skilled local workforce.

Yahsat, its satellite and communications company, is another example of increasing industrial sophistication, launching Al Yah 3 in January, the first satellite to be designed and built by Emirati engineers.

The Barakah nuclear power plant, in Al Dhafra, reflects both a commitment to diverse, low carbon energy and a highly trained workforce. Expected to open by the end of 2019, six out of ten workers will be Emirati.

Behind the undoubted glamour of many of these projects, other important changes are being sought. Emiratis still overwhelming work in Government jobs, vocation training is worryingly low, while private enterprise still frequently complains about the levels of bureaucracy involved in operating in Abu Dhabi and an over complicated visa system.

As these challenges are addressed they will boost efforts to complete the transformation to a diversified economy as much as Formula One race tracks and five star hotels have over the years.