1.0 IntroductionUnited Arab Emirates is known for its fast growing economy as compared to economies of other nations in the global market. This nation has gone through huge economic development and growth since its foundation due to external and internal factors. The economy of any nation is very important as it affects very many aspects of the nation. This includes the living standards and stability in the nation. (Bonne, 1992)Purchasing power parity is used to measure the economic Gross Domestic Product in United Arab Emirates. This paper therefore discusses two main internal factors that contributed to its growth.
It has however been noted recently that some of the sectors have been negatively affected. (Bonne, 1992)This paper also shows the sectors that have been negatively affected. Oil prices have also shown dramatic changes over the years. The OPEC was formed and tried to influence the global oil market. The effectiveness of OPEC in achievement of its overall objectives is questionable and different events had effect on OPEC and oil prices in general. The activities of OPEC have also been analysed in this paper.
(Roll, 1939)This includes the role of these activities and their successes or failures. There are various internal and external factors that influenced oil prices that also affected the state of UAE economy. Finally, the repercussions of the current OPEC policies are explained in this paper. 2.0 Economic growth in UAEAn overall analysis of United Arab Emirates shows that it is one of the most developed economies that are also growing at a very fast rate as compared to that of other nations. This is basing on the HDI, the energy consumption per capita and GDP per capita.
(Roll, 1939)United Arab Emirates’ GDP is currently rated to be third in the Middle East and fourteenth in global arena. The rate at which the economy of United Arab Emirates is growing is enviable. In the year 2006, the economy in this nation grew by 35%. In fact the research shows that between the year 2005 and 2006, United Arab Emirates had the fastest growth on GDP in the whole world. (Bonne, 1992)Source: www. tradingeconomics. com Table 1Table 1 above shows the GDP growth rate in UAE that is adjusted by inflation.
It is very clear from the table that the year 2006 experienced massive growth in the economy. The table also shows that in the year 2000, the nation experienced considerably high GDP. This was due to high revenue from oil and gas exports. (Roll, 1939)In the year 2002, the GDP went so low due to various factors in the market. These included changes in oil production and global oil prices. It then rose steadily until the year 2006 then started experiencing a slight decline.
There are various factors that contributed to the growth in United Arab Emirates’ economy. They are as follows. (Bonne, 1992)3.0 Internal factors that contributed to growthThe economy of a nation is always influenced by both internal and external factors. One of the major internal factors that highly contributed to the growth in United Arab Emirates is its export. This nation is known to export natural gas and petroleum to other nations. This was a major contributor to the overall growth in the economy in this nation. This is considering the fact that the nation was able to get revenue from exporting natural gas and petroleum to other global markets.