Gross Domestic Product as Measure of Economic Health
Gross Domestic Product (GDP) is a key government statistic, which measures the total economic activity of the United Arab Emirates (UAE) as a country. It refers to the sum of all products and services the country produces within a single financial year. An increase in GDP indicates significant improvements in the economy, whereas a declining GDP rate shows a recession. Based on current figures for UAE’s GDP, the country continues to show significant progress in economic development. The latest statistics show that the UAE has improved significantly in the past year, thanks to its robust infrastructure and logistics sector. However, the country is still second to Saudi Arabia among the 15 countries in the Middle East’s Gulf Cooperation Council (GCC). The UAE attained an economic growth of 3.9% in 2014.
The data will still be reliable if the energy sector is excluded because, unlike most countries in the GCC, the UAE has increasingly diversified its economy in the past few years. The country no long relies heavily on the oil sector. In fact, about 75% of the country’s GDP comes from the non-oil sectors of the economy. On the other hand, Dubai is becoming more of a commercial and trade center, representing the economic diversification in the UAE. The other regions in the UAE are also heavily reliant on oil and natural gas for their economic development. Excluding the oil sector from UAE’s economy will have a huge impact on the country in relation to its neighbors in the GCC. However, this is not bound to be destructive as the biggest share of UAE’s economy is not dependent on oil.