United Arab Emirates country brief
The United Arab Emirates (UAE) is situated in the Southeast of the Arabian Peninsula, bordering Oman and Saudi Arabia. In December 1971, the UAE became a federation of six emirates - Abu Dhabi, Dubai, Sharjah, Ajman, Umm al-Quwain, and Fujairah, while the emirate of Ras Al Khaimah joined the federation in 1972. The capital city is Abu Dhabi, located in the largest and wealthiest of the seven emirates.
Since its Federation in 1971, the UAE has developed rapidly and is now noted for its modern infrastructure, international events and status as a trade and transport hub. It possesses among the highest per capita incomes in the world.
The President of the UAE is His Highness (HH) Sheikh Khalifa bin Zayed Al-Nahyan, who is also Ruler of Abu Dhabi Emirate. The Ruler of Dubai Emirate, HH Sheikh Mohammed bin Rashid Al-Maktoum, is the Vice-President, Prime Minister and Defence Minister.
The UAE’s federal structure includes a Supreme Council (comprising the Rulers of each Emirate), a Council of Ministers and a semi-appointed Federal National Council with an advisory role. Each Emirate is still governed by its own Ruler, with its own local government and courts.
The UAE is a member of the Gulf Cooperation Council (GCC), the Arab League, the Organization of Islamic Cooperation, the United Nations, OPEC, the Non-Aligned Movement and the World Trade Organization. The International Renewable Energy Agency, established in 2009, has its headquarters in Abu Dhabi.
The UAE is the Middle East’s second largest economy after Saudi Arabia and one of the wealthiest countries in the region on a per capita basis. The UAE is the eighth largest producer of crude oil and 18th largest producer of natural gas in the world, with January 2012 reserves estimated at 97.8 billion barrels and 6.09 trillion cubic metres, respectively (ranking eighth in the world for both commodities). Its estimated GDP in 2012 was US$284.4 billion, a real GDP growth rate of around 3.1 per cent.
The economy is dependent mainly on oil and natural gas but successful efforts at economic diversification reduced oil- and gas-based output to 25 per cent of GDP in 2011, while goods and services accounted for an estimated 87.5 per cent. The UAE population of about eight million depends substantially on its expatriate workforce, which made up about 88 per cent of the workforce and 80 per cent of the population in 2012. Free trade zones attract foreign investors by offering full ownership and zero taxes.
The government has increased spending on job creation and infrastructure expansion and is opening up utilities to greater private sector involvement. Investment income is also substantial and provides a further element to economic activity.
Abu Dhabi Emirate, which has the vast majority of oil and gas reserves in the UAE, has made significant investments into the establishment of aerospace, nuclear power, defence, information technology (micro-processing), petrochemical and clean-tech industries – the latter most obviously represented by the multibillion-dollar initiative to establish “Masdar City”, a zero-carbon city outside Abu Dhabi. Abu Dhabi is also investing heavily in educational institutions, such as the Sorbonne and New York University campuses, and cultural and sporting attractions such as the Formula One racing track, Ferrari theme park, Louvre Gallery and Guggenheim museum, to diversify the economy away from oil and encourage tourism.
Dubai Emirate has diversified into the tourism, exhibitions, events, ICT, re-export and financial sectors. Taking advantage of its position near the head of the Gulf, it has consolidated its historical reputation as a regional entrepôt. Dubai has developed luxury hotels, large port facilities (including Jebel Ali) and a range of free trade zones to attract both manufacturing and services industries.
In the medium term, the UAE economy will continue to rely on its huge oil and gas reserves – which account for over two-thirds of exports and the bulk of government revenue – to underpin its economic development. However, the UAE is also developing a civil nuclear energy program and plans to build four nuclear power reactors by 2020 with the first scheduled to come on-line by 2017.
Bilateral relations between Australia and the UAE are multi-faceted and growing rapidly. They are underpinned by extensive trade relations, and the UAE is Australia’s largest Middle East trading partner. The UAE and Australia share a common interest in a stable and secure Middle East and Gulf region. The two countries enjoy good defence and law enforcement cooperation, the latter underpinned by agreements on mutual legal assistance in criminal law matters, extradition and an arrangement on counter-terrorism cooperation. Australia signed a Nuclear Cooperation Agreement with the UAE in July 2012 and in May 2013, a Memorandum of Understanding establishing a regular Foreign Minister’s bilateral Dialogue and Senior Officials Talks.
The Australian Ambassador to the UAE, also with accreditation to Qatar, is based at the Australian Embassy in Abu Dhabi, with the Australian Consulate-General in Dubai managed by Austrade. State government offices, representing New South Wales, Queensland, Western Australia, and Victoria are also based in the UAE.
The UAE has hosted a number of senior Australian visitors in recent years, including Governor-General Ms Quentin Bryce AC CVO (in 2010 and 2012) and the then Prime Minister, the Hon Kevin Rudd MP, in 2008. In 2012 and 2013, other senior bilateral visits included: then Defence Minister, the Hon Stephen Smith MP; then Minister for Agriculture, Fisheries and Forestry, Senator the Hon Joe Ludwig; then Minister for Infrastructure and Transport, the Hon Anthony Albanese MP; and then Parliamentary Secretary for Foreign Affairs the Hon Richard Marles MP.
During 2012 and 2013 a number of State government visits, including: the Premier of NSW (May 2012); Victorian Minister for Innovation, Services, Small Business, Tourism and Major Events, who led business ‘super missions’ in each of February 2012 and February 2013; and the Western Australian Minister for Agriculture and Food in February 2012.
The most recent official senior UAE visitors to Australia were the then Minister for Foreign Trade, HE Sheikha Lubna Al Qasimi, in June 2012, and Foreign Minister, HH Sheikh Abdullah bin Zayed Al Nahyan, Minister for Foreign Affairs, who addressed CHOGM Foreign Ministers in Perth as a guest of the then Foreign Affairs Minister the Hon Kevin Rudd MP in October 2011.
People-to-people contacts have expanded rapidly on the back of the strong growth of direct air links, currently around126 flights per week between the UAE and Australia. Around 16,000 Australians live and work in the UAE. In 2012, over 1,000 Emiratis were enrolled to study in Australia.
Two-way merchandise trade between Australia and the UAE in 2012 was worth around $5.13 billion, comprising $2.09 billion in Australian exports and 3.04 billion in UAE exports to Australia. Australia's major merchandise exports are a combination of primary products and elaborately transformed manufactures (ETMs). Eight out of the top 20 exports to the UAE in 2012 were ETMs, constituting over 20 per cent of Australia's total exports to the UAE. Other notable ETM exports include processed iron and steel, vehicle parts and accessories, telecommunications equipment and parts, office machines, paper and paperboard and medicaments (including veterinary). Meat (other than beef), vegetables, wheat, food products, and barley were the lead primary product exports. The main UAE export to Australia, making up the bulk of its trade, is crude oil.
Services trade is an increasingly important component of the commercial relationship, including construction, financial and professional services, tourism and education. Education is seen as an area of potential growth, with Australian institutions already active in the UAE market. However, the number of UAE students studying in Australia remains small.
Australia's commercial profile in the UAE is significant, with over 350 Australian companies based there. There is an increasing presence of Australian companies, institutions and capabilities, including in steel trading, building, construction and financial services, banking services, materials and equipment, agricultural supplies and services, industrial minerals, dairy products, marine manufacturing, education and training services, sports and recreation, health services, livestock, oil field supplies, courier and freight services. Many use Dubai as a regional base, in view of its transport, financial and communications infrastructure. The UAE has significant investment in Australia, including in the agribusiness, tourism and resources sectors.
Updated September 2013