Uae Interact
GMT Time: 22:43 UAE Time: 02:43
Choose your language: French German Russian Spanish Chinese Portugese Korean Italian Japanese
   News & Information on the United Arab Emirates (UAE). Supported by The National Media Council.


web UAE

Embassy of the United Arab Emirates in France
3, Rue de Lota, 75116 Paris, France
Tel: + 33 1 443 40200;
Fax: + 33 1 475 56104
Email: [email protected]



UAE Chambers of Commerce »

NewUAE yearbook The complete UAE Yearbook 2007 in English, French and Arabic in pdf format. Comprehensive, up-to-date information on all aspects of the UAE.

UAE History
Social Development

Visit UAEinteract's virtual museum which features 3D images of ancient gold jewellery Gold Jewellery
Take a tour through our virtual museum with items from coins and ceramic to fossils and toys. Virtual Museum


  1. The Economy in 2006
  2. UAE Stock Exchanges
  3. Federal Budget for 2007
  4. Infrastructure Development
  5. Electricity & Water
  6. Telecommunications
  7. Airports & Ports
  8. Links


The UAE economy was booming in 2006 with astute economic policies continuing to provide solid foundations for impressive growth in all sectors. There is no doubt, however, that the 21.5 per cent increase in oil prices on average prices of US$53.5 per barrel in 2005 was a major contributory factor to economic growth: the build-up of oil revenues leading to an increase in expenditure, which was reflected in the launching of many new projects in non-oil sectors, especially at the local government level.

Abu Dhabi CornicheMinistry of Economy figures for 2006 indicate that UAE GDP grew in nominal terms by 23.5 per cent to Dh599 billion, equivalent to a fixed price (i.e. real GDP) growth rate of 8.9 per cent. Reflecting the country’s policy of economic diversification, the non-oil sector’s contribution to nominal GDP was Dh376 billion or 63 per cent. The manufacturing sector’s share was 19.5 per cent, amounting to Dh73.4 billion, an indication of the emphasis being placed in the country on industrial development. The wholesale and retail trade sector, including a wide range of commodities encompassing consumption, intermediary and capital goods, is a cornerstone of the development process and an important contributor to GDP, amounting to Dh62.5 billion or 16.1 per cent of the total. The thriving real estate sector contributed Dh461 billion or 12.2 per cent to nominal GDP, followed by an active government services sector, which contributed 10.4 per cent or Dh39 billion. The transport, storage and communication sector, one of the leading sectors in the sustainable development process due to the immense volume of accumulated investments directed to its multi-mix activities, was valued at Dh38.5 billion or 10.2 per cent of GDP.

The country has placed great significance on the role of investment in the economic development of all the emirates, with the private sector (both local and foreign) being cultivated as the true engine of sustained growth. To this end, the Government is offering the private sector a wide range of incentives to invest in projects. Foreign direct investment (FDI), in particular, is regarded as crucial in order to transfer knowledge and expertise in areas that are not yet the country’s core competencies, open new market opportunities and create employment in knowledge-intensive and high value-added sectors. Therefore, considerable institutional efforts are being made to amend laws and create a conducive environment to attract foreign capital and encourage international companies to enter the UAE markets. Much success has been achieved in this area already as the country has been rated in second place among Arab countries in two international economic freedom and transparency indices. The UAE is also ranked first in the Arab World in terms of attracting inward investment.

Fixed investments surged substantially by 29 per cent to Dh121 billion in 2006 and consumption increased by 25 per cent to Dh365 billion. Consumer or household spending stood at 83 per cent or Dh304 billion whilst government spending was Dh61 billion.

In terms of balance of trade, UAE exports rose to Dh488 billion and imports increased to Dh359 billion. Oil and petroleum products made up 40 per cent of exports and this percentage is expected to continue to reduce each year as investment in industry and sectors other than oil and gas continue to boost GDP and manufactured products finds markets overseas.

The UAE is an important participant in global capital markets through several investment institutions, including, among others, the Abu Dhabi Investment Council, the Dubai World, Dubai Holding and Abu Dhabi’s International Petroleum Investment Co. (IPIC). Its current account has been in surplus since the foundation of the state.

Banking & Finance

Dubai Finance CentreAlthough profits had more than doubled for many financial institutions in 2005, the impressive gains by UAE banks were driven, at least in part, by profits related to booming local stock markets: the Dubai Financial Market (DFM) index had more than doubled in 2005, while the sister bourse in Abu Dhabi (ADSM) was up more than 80 per cent for the year, with investor appetite for initial public offerings (IPOs) reaching frenzied heights.

In contrast, UAE stock markets, like most regional markets were very volatile in 2006, the UAE market benchmark NBAD General Index dropping 41.2 per cent, an average for UAE indices of 40.3 per cent. In terms of market capitalisation, the UAE market shrank by US$63 billion.

At the same time, Islamic banking has blossomed in the UAE, while the insurance sector has shown robust growth.

Return to top




(million shares)


Market Cap

No. of Companies

Index Gains


















































Source: Respective Stock Exchanges and Global Research, Gulf Business Feb 2007

The three UAE bourses, ADSM, DFM and Dubai Gold and Commodities Exchange (DGCX) are regulated by the Emirates Securities and Commodities Authority (ECSA), which closely follows International Organisation of Securities' organisations' (IOSCO) principles.

Return to top


The federal budget for 2007 has been set at Dh28.4 billion: Dh7.1 billion or 33 per cent of the total budget is allocated to education; 15.7 per cent or Dh 3.3 billion to security and justice; Dh 1.5 billion or 7.1 per cent to health; Dh1.497 billion to social affairs; and Dh1.1 billion or 5.2 per cent to infrastructure projects. Operation of the budget is subject to international accounting standards certified by the International Monetary Fund.


Trump Tower & HotelThe booming economy is fuelling infrastructure development on an unprecedented scale. Residential, tourism, industrial and commercial facilities, education and healthcare amenities, electricity and water, telecommunications, ports and airports are all undergoing massive redevelopment, radically altering the urban environment in the UAE. Many of the new infrastructure projects are based on the public-private paradigm where the private sector is being empowered to continue the process of development initiated by the state.

Reform of property laws has also added impetus to urban development and each of the emirates is taking into account the impact of the planned new developments on an already over-utilised transportation network and is investing heavily in improving roads, bridges and public transport, including the construction of a light rail transport system in Dubai.

Return to top


By mid-2006 the total capacity for electricity production in the UAE was 16,220 megawatts (MW) compared to 9600 MW in 2001, and industry estimates expect the capacity to rise to almost 26,000 MW by 2010. At present, Abu Dhabi Water & Electricity Authority (ADWEA) accounts for 53 per cent of total capacity; Dubai Electricity & Water Authority (DEWA) is responsible for 29 per cent; Sharjah Electricity & Water Authority (SEWA) for 11 per cent; with the Federal Electricity and Water Authority (FEWA) accounting for 7 per cent of capacity.

Approximately 97 per cent of production is fuelled by natural gas and the remaining 3 per cent is produced by diesel generation or steam turbines (primarily in the Northern Emirates). By mid-2007 natural gas from Qatar will be supplied to power and water complexes in Abu Dhabi, Dubai and Fujairah via Dolphin’s 370-kilometre export pipeline.

The UAE’s scarce natural water resources are also under pressure. Although groundwater still plays a significant role in meeting agricultural demand throughout the Emirates, and more than half of the water distributed by the federal authority (FEWA) in the Northern Emirates to date has been sweet groundwater, a high proportion of the UAE’s requirements is being met by an extensive gas-fired desalination programme, with Abu Dhabi accounting for around half of the total desalinated water production in the UAE. Water production, as distinct from capturing groundwater, reached more than 195 billion gallons in 2004. The significant increase in production (up from 130.5 billion gallons in 1996) is primarily a result of the completion of new desalination plants. However, water consumption in Abu Dhabi alone is expected to increase to 5.858 billion cubic metres by 2020.

Water quality testIn order to meet these demands by increasing capacity and improving efficiency, Abu Dhabi has set about privatising its electricity and water sector. Since 1997 six independent water and power production plants (IWPPs) have been introduced on a build, own and operate (BOO) basis via joint venture arrangements, with ADWEA retaining a 60 per cent shareholding in each IWPP, while the remaining 40 per cent is owned by overseas private investors.

Abu Dhabi has also formally embarked on the privatisation of its sewage system.

Although it hasn’t gone down the privatization route, Dubai is also spending significant amounts on electricity and water projects as part of its projected Dh50 billion (US$13.62 billion) investment to expand power generation capacity by 2010 to 9500 MW of electricity and substantially increase its desalination capacity.

Abu Dhabi and Dubai’s power grids were connected in mid-2006 and the remaining emirates were linked in the first half of 2007 to form the Emirates National Grid (ENG), which will eventually link up with the US$1.1 billion GCC grid.

Return to top


Liberalisation in the marketplace has impacted on the telecommunications sector, which entered a new phase in 2006 with the release of the General Policy for the Telecommunication Sector (GTP) by the Supreme Committee for the Supervision of the Telecom Sector (SCSTS). The goal of the GTP is to encourage competition between operating companies, increase the involvement of UAE nationals in the process of economic development and contribute to economic diversification by promoting the UAE as an ICT hub.

Emirates Telecommunications Corporation (Etisalat), until 2006 the sole telecom operator in the UAE for 30 years, has made the UAE one of the most wired nations in the region with penetration figures of key services comparable to the most developed markets worldwide. Mobile penetration, with over 5.1 million customers, has exceeded the 100 per cent mark (125 per cent), a first in the region; 578,000 internet subscribers have access to the internet and fixed lines subscribers number 1.3 million (2006 figures).

Mobile phone communicationEtisalat has also invested heavily in the regional telecommunications industry and in 2006, with a market value of US$25.32 billion, it was ranked the sixth largest corporation in the Middle East and two hundred and seventy-eighth among the world’s top 500 companies.

As part of the process of liberalisation, the Telecommunication Regulation Authority (TRA) authorised Emirates Integrated Telecommunications Company (EITC), trading as ‘du’, to enter the market in December 2005. Twenty per cent of the company was offered for public subscription early in 2006 and du commenced trading on the Dubai Financial Market (DFM) in April 2006, following the highly successful public offering. du has set itself the target of acquiring 30 per cent of the UAE market within three years.

Etisalat is also a major shareholder in, and a service provider for, Thuraya Satellite Telecommunications Company, the Abu Dhabi-based satellite telecom service provider that was founded in the UAE in 1997 by a consortium of leading national telecommunications operators and international investment houses. Thuraya offers cost-effective satellite-based mobile telephone services to nearly one-third of the globe through dual-mode handsets and satellite payphones. The company’s third satellite, Thuraya 3, will be deployed in 2007.

Return to top


Significant economic development has led to a corresponding expansion in airport and related infrastructure in the UAE, where the total investment on airport development over the coming 20 years will exceed Dh75 billion (US$20.43 billion). This figure includes redevelopment of Abu Dhabi International Airport at a cost of Dh30 billion (US$8.17 billion); Dh15 billion (US$4.08 billion) being spent on the ongoing expansion of Dubai International Airport; and Dh30 billion (US$8.17 billion) estimated for the new Dubai World Central development, which will house the UAE’s seventh international airport.

Etihad Airways airplaneIn addition, Sharjah International Airport intends to spend Dh227 million (US$61 million) on redevelopment, Ajman is committing another Dh2.9 billion (US$800 million) to build its new airport and Fujairah has pledged Dh183 million (US$49 million) investment for the expansion of its terminal and associated structures. Al Ain International Airport is undergoing a Dh75 million (US$20.43 million) redevelopment, while the Ra’s al-Khaimah government is investing Dh1billion (US$272 million) in expansion of its airport. The sum total of these projects ensures that the UAE has become the largest investor in airport development in the Middle East.

The pace of airport expansion has been influenced by the phenomenal success of existing airlines such as Dubai-based Emirates, and new airlines, such as Abu Dhabi-based Etihad Airways, Sharjah’s Air Arabia, the region’s first budget airline, and RAK Airways, the newest of the national airlines. Emirates ranks among the top-ten airlines in the world and with a 70 per cent share of all new Middle Eastern orders for long-haul aircraft, plans to triple its capacity over the next eight years. Etihad, on the other hand, is one of the world’s fastest growing airlines with far-reaching plans to expand its international route network.

Considering its strategic geographical position between East and West, the UAE’s ports, like its airports are an essential tool for driving economic growth, particularly economic diversification, and are therefore undergoing considerable expansion.

Mina (Port) Zayed in Abu Dhabi City is that emirate’s main general cargo port. In addition Abu Dhabi Ports Company (ADPC) is building a major new facility, Khalifa Port, with adjacent industrial zone, at Al Taweelah, the first phase of which will cost in the region of Dh8 billion (US$2.18 billion). A major new industrial port at Mussafah is also expected to commence operating in 2009. Mina Zayed

Dubai’s Ports at Port Rashid in Dubai City and Jebel Ali south of the city play a pivotal role in trade in the UAE. In particular, Jebel Ali, which primarily handles bulk cargo and industrial material for Jebel Ali Free Zone, is the largest port in the country and the largest man-made port in the world.

All of Dubai’s ports have experienced a steep rise in throughput in recent years. This is set to rise even further when the first phase of the four-phase, Dh4.6 billion (US$1.25 billion) expansion at Jebel Ali comes on-stream in 2007.

Sharjah is the only emirate with a port on both UAE coasts. Its East Coast port, Khor Fakkan Container Terminal (KCT), the only natural deep-water port in the region, has a strategic geographical position in the context of today’s huge deep-sea container trade, being close to the main east-west shipping lanes and outside the sensitive Straits of Hormuz. Already one of the top container trans-shipment hub ports in the country, KCT is being significantly expanded at a total cost of Dh300 million (US$81.75 million).

Fujairah Port commissioned an additional 150,000 cubic metres of onshore bunker storage facilities early in 2005, ensuring that it now ranks as the second largest bunkering centre in the world, supplying 12 million tonnes of fuel oil a year, worth US$2.5 billion (Dh9.17 billion).

Return to top

UAEInteract links

Return to top


Home - Contact - Send this Page - Site map - Copyright, Terms & Conditions