The United Nations proclaimed 2017 to be the “International Year of Sustainable Tourism Development.” Tourism is easily identifiable for its economic, social, cultural, environmental and heritage value. The World Travel & Tourism Council (WTTC) compiles statistical evidence to evaluate the economic and employment impact of the industry, which help them determine their long-term forecasts. Naturally, economic prediction is impeded by terrorist atrocities, political unrest and world disasters. Nevertheless, travel and tourism remain a resilient sector and it is expected to experience 4% growth globally. The UAE however is set for a 5% rate of growth according to the WTTC, who went on to announce that by 2027, their research implied that 12.4 % of the GDP would be provided by the sector.
The UAE has managed to maintain its position of the second largest economy in the Arab World. This has been achieved by adopting a sound economic model and the vision to develop a diversified competitive competence. A tremendous amount of vigour has been applied to policy that focusses on building infrastructure and commerce, along with several initiatives promoting innovation, which includes advanced technologies identified for enhanced investment.
The annually published World Competitiveness Yearbook collated by the International Institute for Management Development is recognised as a measure of a successful economic policy. In order to deliver a concise evaluation, the IMD uses 250 indicators split into 4 main groups.
The UAE ranked 7th in the world in the 2018 publication, and has moved up 3 places from 10th in 2017, which is a remarkable achievement given the global circumstances. According to the IMD, the 3-place rise is largely down to the strengthening of international trade.
Industry is designated to be of high economic importance in the UAE, primarily because it forms the basis for diversification of source income and it fits their strategy for economic stability. The federal government is working proactively and has devised a strategy, which is in tune with the UAE Vision 2021 Jubilee objectives. The directive is to “establish a diversified sustainable, knowledge based economy that encourages small enterprises and the investment into the global economy to increase the industry contribution to the GDP by 25% by the year 2025.”
OPEC – Organisation of the Petroleum Exporting Countries – is an assembly of 15 oil producing nations. Its primary role is to stabilise the oil market, and promote the economic balance through policy. The organisation has often been criticised for oligopolistic behaviour by appearing to collaborate to reduce the market competitiveness, and to a certain extent posturing politically. The UAE has managed to cooperate with the OPEC without damaging the economy as a whole, and in doing so, has continually avoided the paradox of plenty – which is a country with an abundance of natural resources that tends to have less economic growth. Economic growth is expected to continue in view of the oil price rebound and probable increased oil production. The implementation of investment projects within the infrastructure sectors should further stimulate economic activity. Commodity exports are also expected to rise, which should boost the trade surplus. All in all, the UAE appears to be in pretty good economic shape all round, and barring any disaster, it should continue to be so.