The Abu Dhabi Economic Vision 2030
Oil, Gas & The Need for Diversification
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Abu Dhabi has the world’s sixth largest proven oil reserves with 98 billion barrels worth.
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It is the tenth largest producer of oil in the world, currently producing 2.5 million barrels per day.
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Abu Dhabi is one of the world’s top 25 exporters of natural gas.
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The Emirate’s participation in the oil and gas sector spans the entire range of activities, including
exploration, production, transport, refining and marketing of oil and gas.
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Abu Dhabi has exceptionally low production costs and vast economies of scale.
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However, economic growth is currently coupled too closely with oil prices and therefore shows signs of
high volatility.
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The primary role oil plays in the economy means that GDP growth tends to be overly sensitive to
fluctuations in the oil price.
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There is a need to reduce exposure to oil price fluctuations.
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As soon as Abu Dhabi furthers its economic diversification by stimulating non-oil sectors, and especially
export-orientated businesses, the volatility in the economy’s growth will start to decrease.
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Even non-oil sectors demonstrate sensitivity to the oil price, because they tend to be inward looking and
are therefore reliant on domestic liquidity.
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The key to sustainable development lies in stimulating non-oil sectors and diversifying the range and
depth of economic activity.
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Abu Dhabi’s aim is to stimulate non-oil sectors rather than to reduce activity in the oil sector.
Productivity must be increased through a focused approach on Abu Dhabi’s competitive advantages.
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Abu Dhabi’s immediate priorities of sustainable economic growth and non-oil sector diversification can be
quickly achieved through the development of “National Champions”: large enterprises that underpin the
economy and around which industrial and service clusters could develop.
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The building of “National Champions” has been favoured by countries with a particular competitive
advantage, such as leadership in a certain field, or an abundance of certain resources, such as a large
workforce or availability of a natural resource. With its abundant energy capital, Abu Dhabi fits this
profile.
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