To diversify focus away from oil and gas, the UAE cabinet decided to increase the local export market to 50% of the total export. Cabinet approved an export development policy to support the country’s foreign trade and thereby increase the GDP contribution from non-oil sectors. This was to be attained by opening new channels and agreement finalization with strategic markets around the world.
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This move is looked upon as a positive approach to the country’s dependency on the oil and gas trade. Through the years, the Gulf countries have allotted only limited importance to non-hydrocarbon merchandise due to the abundant source of oil and the ever-increasing demand for oil. But recent years have seen a change in this demand, and this paved to find new ways to generate revenues. Export diversification was introduced to create job opportunities for their citizens and to amass foreign exchange to fund their import needs.
When thoughts concerning the actual products to export, the country believes that re-exports is the major division through which they can increase their wealth. UAE has established itself as a trading hub for many years and this would augment the country in re-exporting. Even when the plan is to re-export, the country is aware of the dangers of global shock and its implications in this mode. Recent developments such as the pandemic and the Suez Canal incident have proved this.
