University of Wisconsin-Eau Claire
Applied Economic Policy
Design in a Developing Nation
Abu Dhabi - UAE
Dr. Thomas Kemp
University of Wisconsin – Eau Claire
University of Wisconsin-Eau Claire
The Region
University of Wisconsin-Eau Claire
People and Places
University of Wisconsin-Eau Claire
People and Places
University of Wisconsin-Eau Claire
Basic Macroeconomic Data







GDP – 620,316,000,000 AED (169 Billion USD)
GDP Growth Rate – 15.9%
Oil Share of GDP – 49.7%
Per Capita GDP – 315,300 AED (86 Thousand USD)
Non-Oil Exports - 11,610,900,000 AED (3.1 Billion USD)
Imports – 86,574,100,000 (23.5 Billion USD)
Currency – Dirham – Pegged to Dollar at a constant
3.675/1
University of Wisconsin-Eau Claire
Foreign Trade Data

Primary Exports
– Oil and Refined
Petroleum Products
– Transport Vehicles
– Plastics, rubber, and
articles thereof
– Base metals and
articles of base metals

Primary Imports
– Machinery
– Transport Vehicles
– Base Metals and
articles of base metals
– Plastics, rubber, and
articles thereof
– Products of the
Chemical or allied
industries
University of Wisconsin-Eau Claire
History

Recent
– Originally seven
separate Emirates
under the protection of
Great Britain. (Trucial
States)
– Gained Independence
and Seven Emirates
came together to form
the UAE in 1971.
University of Wisconsin-Eau Claire
Task: Determine the Economic Impact of the
Maritime Sector on GDP of the Emirate

Issues;
– No Employment Data by
industry beyond 1 digit
ISIC
– No Wage Data by industry
beyond 1 digit ISIC
– No Value Added or Output
Data beyond 1 digit ISIC
– Reluctance to Share Data
by All Parties
– No clear definition of the
“Maritime Sector”

What to Do?
– Normal methods for
determining economic
impact are not possible.
– Studies in other sectors
have been done using
European data.
– Other studies still simply
“estimate” impacts based
upon those in other parts of
the world.
University of Wisconsin-Eau Claire
Never Say Die

Result: “On this basis
direct revenues are about
3.2% of annual GDP
while indirect revenues
account for another 2.7%.
There is no accounting
within this report of
induced impacts as the
data necessary to
determine them is not
available at this time.”
University of Wisconsin-Eau Claire
Getting There

First Assess: What do
we know?
– Building the
relationships
»
»
»
»
»
Statistic Bureau
Ports Authority
National Authorities
Ports Users
Tourism Authority
University of Wisconsin-Eau Claire
Next Steps
What can we say and what
can’t we say?
– Only revenue data – Can’t
express as value added.
– What exactly is the
Maritime Sector? – need to
define.
– Some of our data is based
upon studies that are not
available and can not be
scrutinized.
70000000
60000000
50000000
World Production
World Production
Poly. (World…
y = 0.0014x6 - 0.4314x5 + 48.52x4 - 2455.1x3 + 57008x2 522081x + 1E+06
R² = 0.9948
40000000
30000000
20000000
10000000
0
-10000000
Year
1904
1909
1914
1919
1924
1929
1934
1939
1944
1949
1954
1959
1964
1969
1974
1979
1984
1989
1994
1999
2004
2009

University of Wisconsin-Eau Claire
Being Diplomatic

Combining the two [direct and indirect impacts] gives us some idea about what the
economy would look like were there no maritime sector in the Emirate. That is, about
6% of the current Abu Dhabi economy is either directly involved with or wholly
dependent upon the maritime sector. That said, it is almost certain that the total impact
of the sector is significantly larger than this. Known employment in the sector
(excluding fishermen) is over 3,500 individuals.

Ideally these amounts should be expressed in terms of value added rather than total
revenues. The data is not available at this time to make these calculations. We therefore
must make the problematic assumption that revenues equal value added. At such time
that SCAD has the necessary data available a new study should be done. The below
study should therefore be seen as a stopgap attempt to get some idea about the scope and
scale of the maritime sector within the Emirate of Abu Dhabi.
See section nine (9) for the methodological problems associated with this assumption.

University of Wisconsin-Eau Claire
Some Principles





Saying “not possible” is not
always an option.
Understand the objective – most
people don’t speak “Econ.”
Building local human resources
is critical.
Be clear about results.
Make polite suggestions about
how to improve data.
University of Wisconsin-Eau Claire
Questions?