Date
23 March 2017
All of the emirates have been allocating a large portion of government revenue into improving social welfare benefits and public services. Photo: Arabian Business
All of the emirates have been allocating a large portion of government revenue into improving social welfare benefits and public services. Photo: Arabian Business

How a knowledge-based economy powers the UAE

When it comes to the best country to invest in along the “One Belt, One Road”, it has to be the United Arab Emirates (UAE), not just Dubai with which we are all familiar. Indeed, it has to be the entire federal monarchy.

Thanks to its well-established federal system under which the seven-member emirates are entitled to a high degree of autonomy, the UAE has been well-known for social and political stability in the Arab world.

Apart from its well-functioning political system, the UAE’s stability is also, to a large extent, attributed to its huge wealth from oil exports.

And leaders of the seven emirates are anything but stingy when it comes to social welfare spending. In fact, over the years, all of the emirates have been allocating a large portion of government revenue into improving social welfare benefits and public services.

That explains why the UAE was largely spared social unrest and political turbulence during the Arab Spring and has succeeded in preventing the infiltration of Islamic State, because its people are generally happy with the status quo, and are therefore less prone to Islamic extremism unlike their counterparts in other Arab countries.

Above all, what truly makes the UAE stand out from its Arab neighbors is that its leaders attach great importance to providing free and high-quality education for their people, men and women alike, which is quite unusual in the Arab world, and have been working aggressively to develop a knowledge-based economy.

As a result, the literacy rate in the UAE is the highest in the Arab world, and many of its homegrown talent occupy key positions in both the public and private sectors in other Arab countries.

What is particularly noteworthy is that the UAE leaders have a huge appetite for foreign business, financial, scientific, medical and IT talent, and have been putting a lot of effort into attracting elites from around the world.

And their efforts have paid off: today the UAE is the undisputed business, financial and scientific hub in the region.

In recent years, the UAE has also become an investment hotspot for Chinese companies.

At present, more than 2,500 Chinese companies operate in the UAE, and there are an estimated 150,000 to 200,000 Chinese laborers and business executives working and living in the federal monarchy.

In a sense, the UAE is just like Hong Kong in the middle of a desert.

This article appeared in the Hong Kong Economic Journal on Mar. 10

Translation by Alan Lee

[Chinese version 中文版]

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AC/RA

Associate professor and director of Global Studies Programme, Faculty of Social Science, at the Chinese University of Hong Kong; Lead Writer (Global) at the Hong Kong Economic Journal

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