Over the past 50 years, diversifying the economy away from reliance on oil and gas was at the heart of the UAE’s development strategy. Non-hydrocarbon sector now accounts for about a third of the GDP, a transition over decades where the main driver of the UAE’s growth was Hydrocarbon resources and the government continued investments in oil and gas manufacturing. As the UAE is looking ahead to the next half a century, it is innovating along with other regional and global producers to diversify its assets, improve efficiency, turn to renewables as an alternative source, grow into a world leader in developing hydrogen and become a global business, technology and tourism hub.
In that regard, the United Arab Emirates recently announced plans to launch more than 40 new initiatives aimed at boosting the country's competitiveness and attractiveness. This includes investments in technology to increase the number of programmers and resident tech firms, new reforms such as the 4 and half working week, attracting foreign investment with large scale events and infrastructure projects, and creating new visas to attract residents and skilled workers. The UAE is seeking to cast itself as more open to foreign investment being the second largest economy in the Arab world after its neighbor, Saudi Arabia. In recent years, UAE has been facing pressures from Saudi Arabia, which is largely investing across its sectors to diversify the economy with ambitious targets for 2030, and one of them is to become the technology and business hub of the region.
As part of these plans, the UAE recently announced that it will introduce a new class of visas intended to ease the restrictions on foreign nationals as the country seeks to boost the economy and attract foreign workforce and capital. Currently, expats are given limited visas that are typically tied to their employment or dependency. Long-term residency was challenging to be obtained for many workers coming from regions such as Africa, Asia, and the Middle East.
The new “green visa” holders will be allowed work in the UAE without being sponsored by an employer. Under the proposed rules, green visa holders will also be able to sponsor their children’s visa until they are 25. The plan includes the introduction of new types of visas, for freelancers and skilled workers and entrepreneurs. The UAE government said that it will allow people who’ve lost their jobs to remain in the country for up to 180 days.
UAE’s plan to attract foreign talent marks an ambitious vision for the future, where UAE continues to be the business hub for the region with an efficient ecosystem and exceptional human capital resources. Particularly these initiatives mainly benefit workers in the technology sector, as the UAE plans to focus on attracting IT companies and hire more coders and programmers. As such, unskilled workers could be disproportionately affected, and are required to start improving their skillset and capabilities to stay relevant.
Another notable initiative that the UAE is leveraging to push the success of its initiatives is the extension of its relationships with Israel, becoming a third country in the Arab world. The move is mainly to attract more tourists, investors new technologies. One of the biggest winners from this is the startup ecosystem, which is benefitting from the solid Israeli startup ecosystem.
As the UAE marked its 50 years anniversary, it’s Expo 2020 which happens to be occurring at the same time and was launched in October 2021, running till end of March 2022, is turning out to be a success with on premise visitors exceeding 7 million, while virtual visits exceeded 30 million.
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