Economic Development FWS205 UAE & GCC Society April 2024

Economic Development FWS205 UAE & GCC Society April 2024  TOPIC OBJECTIVES Topic Objective To distinguish between different systems of development and to identify the economic system in the UAE To understand key concepts of economics and be able to relate t...

Economic Development FWS205 UAE & GCC Society April 2024  TOPIC OBJECTIVES Topic Objective To distinguish between different systems of development and to identify the economic system in the UAE To understand key concepts of economics and be able to relate these to economic development in the UAE To demonstrate knowledge of the strategies being used by the government to strengthen the UAE economy, particularly in light of the global economic environment  WhatWhat is Economics? is Economics Economics is a social science concerned with production, distribution and consumption of goods and services. It studies how individuals, businesses, governments and nations make choices on allocating resources to satisfy their wants and needs. Tries to determine how these groups should organize and coordinate efforts to achieve maximum output.  Key Concepts in Economics 1) Microeconomics 2) Macroeconomics 3) Economic Systems 4) Scarcity, Trade-Offs and Opportunity Costs 5) Law of Supply and Demand 6) GDP 7) International Trade  Microeconomics Microeconomics is the social science that: 1.Studies how individual human decisions affect the utilization and distribution of scarce resources 2. Shows how and why different goods have different values 3. Looks at how individuals make more efficient or more productive decisions  Macroeconomics Macroeconomics is a branch of the economics field: 1.Studies how the aggregate economy behaves 2. A wide variety of economic phenomena are examined: inflation, price levels, rate of growth, national income, gross domestic product and changes in unemployment 3. Focuses on trends in the economy and how the economy moves as a whole Basic Economic System  Opportunity Cost When comparing the top 2 choices, it is the BENEFIT of the next best alternative that must be sacrificed to satisfy a want. The best thing we give up to get what we want.  Law of Demand Demand is the desire to own something and the ability to pay for it. The law of demand states: -When a good’s price is lower, consumers will buy more of it. -When the price is higher, consumers will buy less of it. FACTORS AFFECTING DEMAND 1. Prices of Goods 2. Income of Consumer 3. Prices of Related Goods 4. Population background/trends 5. Tastes, Habits  Law of Supply The law of supply states that, the quantity supplied of a good rises when the price of the good rises, as long as all other factors that affect suppliers’ decisions are unchanged Law of Supply Gross domestic product (GDP) GDP is the total of all economic activity in one country in one fiscal year, regardless of who owns the productive assets. For example, UAE’s GDP includes the profits of a foreign firm located in the UAE. Per Capita Income  Per Capita Income The total national income divided by the number of people in the nation. 10 Richest Countries in the World Source: https://gfmag.com/data/richest-countries-in-the-world/  UAE STRATEGIES FOR ECONOMIC DEVELOPMENT  Economic Strategies 1. Historical context 2. Discovery of oil 3. Economic diversification 4. Key sectors 5. International trade  Abu Dhabi Economic Vision 2030 V i d e o  Abu Dhabi Economic Vision 2030 Abu Dhabi Economic Vision 2030 1. Background: Overview of the Abu Dhabi Economic Vision 2030 initiative, launched by the government of Abu Dhabi to guide the emirate's economic development and diversification efforts. 2. Vision statement: Articulation of the long-term goals and aspirations of the initiative, emphasizing sustainable economic growth, diversification, and global competitiveness. 3. Strategic framework: Explanation of the strategic framework outlining key pillars and priorities to achieve the vision, including economic diversification, infrastructure development, human capital enhancement, and social development.  Economy and Vision 2021 The Government of the UAE seeks to attain sustainable development through the implementation of UAE Vision 2021 through diversification of economy with investments in the non-oil sector to decrease the share of oil revenues. Key non-oil sectors include: Tourism Aviation Retail Hospitality Real estate Construction Trade and investment Aerospace and technology Enhance competitiveness in foreign markets and Develop and promote commercial diplomacy with other countries *Economy – The Official Portal of UAE Government: https://u.ae/en/about-the-uae/economy  Projected Growth Rates of Main Sectors in Dubai(%) https://dubaided.gov.ae/StudiesAndResearchDocument/DER2019_EN_Report_f4.pdf United Arab Emirates GDP per capita1975-2018 Data Diversification of the Econom Public Private Partnership  Value Added Tax Value Added Tax (VAT) VAT was introduced in the UAE on 1 January 2018. The rate of VAT is 5 per cent. VAT will provide the UAE with a new source of income which will be continued to be utilized to provide high-quality public services. It will also help government move towards its vision of reducing dependence on oil and other hydrocarbons as a source of revenue.  Digital Economy Strategy Objective: Digital Economy contribution to be 20% of UAE's non-oil GDP by 2031 The strategy aims to double the contribution of the digital economy to the UAE's non-oil GDP from 11.7 per cent to over 20 per cent within the next 10 years.  Circular Economy In 2021, the UAE Cabinet approved the UAE Circular Economy Policy to provide a comprehensive framework for determining the country’s approach to achieving sustainable governance and the ideal use of natural resources, by adopting consumption and production methods that ensure the quality of life for current and future generations. The policy is a framework for identifying the priorities in terms of circular economy. Priorities include infrastructure, sustainable transportation, sustainable manufacturing, sustainable food production and consumption. Additional Links on UAE’s Economic Policy UAE Economy and Vision 2021 (Related to Diversification, Innovation, Youth development, Sustainability, Digital economy, etc.) https://u.ae/en/about-the-uae/economy The UAE Strategy for the Fourth Industrial Revolution https://u.ae/en/about-the-uae/strategies-initiatives-and-awards/federal-governments-strategies-and-plans/the-uae-strategy-for-the-fourth-industrial-revolution The Abu Dhabi Economic Vision 2030 https://www.ecouncil.ae/PublicationsEn/economic-vision-2030-full-versionEn.pdf Expo202 https://www.expo2020dubai.com/ Emirates Blockchain Strategy 2021 https://government.ae/en/about-the-uae/strategies-initiatives-and-awards/federal-governments-strategies-and-plans/emirates-blockchain-strategy-2021 UAE’s Culture & Heritage Preservation Initiatives https://u.ae/en/about-the-uae/culture/arab-and-islamic-heritage UAE Economic Outlook https://www.youtube.com/watch?v=yajJKGmvuGk https://gulfnews.com/business/coronavirus-impact-to-drag- down-gcc-growth-to-06-in-2020-1.70675687 *https://gulfnews.com/business/coronavirus-impact-to-drag- down-gcc-growth-to-06-in-2020-1.70675687 https://www.khaleejtimes.com/business/global/imf-slashes-uae- global-growth-forecast Understanding GDP and International Trade (Play the Trading Game) https://www.economicsnetwork.ac.uk/showcase/ young_tradegame#Downloadable_Materials