embassy: Embassies District, Plot 38 Sector W59-02, Street No. 4, Abu Dhabi
mailing address: P. O. Box 4009, Abu Dhabi
telephone: [971] (2) 414-2200
FAX: [971] (2) 414-2603
consulate(s) general: Dubai
Flag description:
three equal horizontal bands of green (top), white, and black with a wider vertical red band on the hoist side
Economy ::United Arab Emirates
Economy - overview:
The UAE has an open economy with a high per capita income and a sizable annual trade surplus. Successful efforts at economic diversification have reduced the portion of GDP based on oil and gas output to 25%. Since the discovery of oil in the UAE more than 30 years ago, the UAE has undergone a profound transformation from an impoverished region of small desert principalities to a modern state with a high standard of living. The government has increased spending on job creation and infrastructure expansion and is opening up utilities to greater private sector involvement. In April 2004, the UAE signed a Trade and Investment Framework Agreement with Washington and in November 2004 agreed to undertake negotiations toward a Free Trade Agreement with the US. The country's Free Trade Zones - offering 100% foreign ownership and zero taxes - are helping to attract foreign investors. Higher oil revenue, strong liquidity, housing shortages, and cheap credit in 2005-07 led to a surge in asset prices (shares and real estate) and consumer inflation. The global financial crisis and the resulting tight international credit market and falling oil prices have already begun to deflate asset prices and will result in slower economic growth for 2009. Dependence on oil and a large expatriate workforce are significant long-term challenges. The UAE's strategic plan for the next few years focuses on diversification and creating more opportunities for nationals through improved education and increased private sector employment.