NIGERIA, AFRICA AND THE UAE SUCCESS STORY
Over the last two decades, some nations of the world, notably the Asian Tigers and the Gulf Coast Co-operations countries continue to make profound statements that industrialization, economic development and the attendant prosperity of their peoples are no longer the exclusive preserve of the West.
Among these nations, the rapid transformation of the United Arab Emirates (UAE) with its political capital in Abu Dhabi and economic capital in the maverick Dubai, from nomadic farming and near total oil-dependent economy up until the early eighties had been well documented and continue to make global headlines.
What is of interest here however is not the planned and deliberate attempt at goals setting, tasking and accomplishment that were the very foundation of UAE successes. And neither is it the tenacity of purpose with which the goals were consummated.
The concern is for a fair understanding what it has taken to sustain such phenomenal growth levels over the years in spite of the turbulence of global economic hiccups and vagaries of the international oil market.
Of note is also the need to unravel the take homes and accruable benefits open to other nations, most especially Nigeria and the rest of Africa from the Dubai spectacle.
With oil presently contributing less than 30% to its GDP, down from 79% in 1981, and a society poised to dictate its future, the UAE has continued to push the frontiers of development in all critical sectors like tourism, education, ICT, healthcare, agriculture, energy and more recently; manufacturing, artificial intelligence and the Greenfield Society initiative, all of which have earned Dubai a envied position of the epicenter of global commerce.
In its Global Competitiveness Report for 2017-2018, the World Economic Forum scored the UAE 73.37 points out of 100 and ranked 17th of 137 economies and 1st in the Middle East.
Similarly in a recent publication tagged Features of the UAE Solid Economy, the official portal of the UAE government, Government.ea asserted that "despite recent fluctuations in oil prices and global economic recession, the UAE enjoyed a stable economy. The publication then listed "strategic location, strong financial reserves, large sovereign wealth fund, promising investor home economies, consistent government spending, progressive policy of economic diversification, free zones and increased foreign direct investment" as contributors to the robust economy. In a complement, International Monetary Fund IMF Chief, Christine Lagarde, also added elsewhere that the UAE financial leaders "must be commended for their sound fiscal policies".
Strategic Location –the UAE enjoys a strategic location between Asia, Europe and Africa. Hordes of Chinese, India and Latin America use Dubai businesses as a hub to reach other parts of the world, while Western countries presently use Dubai as the hub for the Middle East.
Strong Financial reserves –The UAE maintains a strong financial reserves and has a durable banking sector which makes it safe place to invest. The IMF forecasts that the "gross official reserve of the UAE would grow from USD 76.8 billion in 2018 to USD 118.4 billion in 2020." The National Standard also reports the AA rating of Abu Dhabi by Standards & Poors, a financial services firm as a "measure of its capacity to meet up on its financial obligations as very strong in the long term".
Consistent Government Spending- Government spending on infrastructure continues to receive a major injection of capital. Abu Dhabi continues to develop the infrastructure required for the richest cities in the world. Dubai is implementing new projects for hosting World Expo in 2020; USD 18.17 (AED18.17billion)will be spent on the Expo infrastructure and the city.
Promising Investor Home Economies- According to UNCTAD World Investment Report of 2014, the UAE ranks 11th as the most promising investor home economies.
Progressive Policy of Economic Diversification – This has led to impressive development of key sectors such as tourism, air transport, trade, financial services, manufacturing and alternative energy. The country has made remarkable progress towards reducing its dependence on hydrocarbons.
Free Zones – The UAE has several multi-specialty free zones economic incentives such as exemption from corporate taxes and export/import duties and full foreign ownership and 100% profit repatriation. There exists about 45 free zones and according to report in the Gulf News, these zones account for 33% of non oil trade in 2014.
Increased Foreign Direct Investment (FDI) – A report by the Ministry of the Economy indicates that the UAE attracted about USD10.4 billion of foreign direct investment in 2017. The UE was ranked first among the countries most attractive to foreign direct investment in the Middle East and African region.
All of the factors listed above with a strong combination of economic liberty, strategic policy and modernization have yielded high employment figures and raised the per capita income to USD 47, 439. (World Bank Report 2017). This has strongly enhanced the quality of lives, and ushered improved well being and prosperity.
The authorities in the UAE through the Dubai Chamber of Industry recently declared a determination to invest USD 27million to create awareness on trade and investment opportunities in Africa and promote Dubai as an attractive business hub for investors on the continent. A FDI intelligent report also suggested that UAE with its 12% share of FDI on the Africa continent grossed a capital of USD 11 billion, making it the second highest investor in Africa.
Although much of the FDI from UAE is concentrated in Eastern and South Africa, the rest of Africa particularly Nigeria with its abundance of human and material resources can take advantage of this initiative to transform and grow its economy.
It is for this reason that the United Arab Emirate, beside the Embassy in the Federal Capital, Abuja, newly inaugurated its consulate in the Nigerian commercial capital of Lagos for the promotion of mutually beneficial trade, investment and socio-cultural engagements among the citizens of both sovereign nations.
It is interesting that this is coming at a time that Nigeria is reaching out to other parts of the world beyond the confines of its traditional trading partners. When consummated, an effective collaboration between the two countries will be enhanced profoundly by the already existing historical facts of proximity and cultural affinity.
Nigeria, home to the largest population in Africa and the 7th most populous globally, with an estimated 90 million (3rd after China & India) of the population, within trainable and employable years of about 18 will no doubt derive enormous advantages from targeted inflow of FDI in knowledge, expertise, technology and finance
Nigerian and Emirati entrepreneurs can develop partnerships that will engender exchange of raw materials as well as finished products from agriculture, extractive industries, oil & gas education, technology and entertainment. And above all, a window to Europe, Asia, the Middle-East and a global market space through an existing functional Dubai economic hub with its vast stock of social capital.
On the medium and long-term such engagements will rob off on the economy and the people of both nations in terms of provision of basic services, infrastructure and an enhanced and decent living standard comparable to global standards.