United Arab Emirates
The Trucial States of the Persian Gulf coast granted the UK control of their defense and foreign affairs in 19th century treaties. In 1971, six of these states - Abu Dhabi (Abu Zaby), 'Ajman, Fujeirah (Al Fujayrah), Sharjah (Ash Shariqah), Dubai (Dubayy), and Umm al Qaywayn - merged to form the United Arab Emirates (UAE). They were joined in 1972 by Ra's al Khaymah. The UAE is a federation of these seven emirates located on the Arabian Peninsula. It has a coastline and seaports both inside and outside the Straits of Hormuz at the entrance to the Persian Gulf. The total area of the UAE is about the size of Maine. Each emirate is ruled by a Sheikh who not only retains control within his emirate over natural resources, including oil, but also regulates commercial activity. Since hydrocarbon reserves and thus revenues are not equally distributed, the seven emirates are not equal in terms of wealth, power, or level of economic development. Abu Dhabi, the largest oil producer, is the wealthiest and most powerful, followed by Dubai, the federation's commercial center and second largest oil producer.
In 2004, the U.A.E.'s first and only president, Sheikh Zayed bin Sultan Al Nahyan, died. His eldest son Khalifa bin Zayed al Nahyan succeeded him as Ruler of Abu Dhabi. In accordance with the Constitution, the U.A.E.'s Supreme Council of Rulers elected Khalifa bin Zayed Al Nahyan as U.A.E. Federal President. Mohammed bin Zayed al Nahyan succeeded Khalifa as Crown Prince of Abu Dhabi. In January 2006, Sheikh Maktum bin Rashid Al Maktum, U.A.E. Vice President and Prime Minister and Ruler of Dubai, passed away and was replaced by his brother, Sheikh Mohammed bin Rashid Al Maktoum, Crown Prince of Dubai and Minister of Defense. On February 9, 2006, the U.A.E. announced a cabinet reshuffle.
Approximately 20% of the population are UAE nationals. The rest are expatriates such as Palestinians, Egyptians, Jordanians, Yemenis, Omanis, Iranians, Pakistanis, Indians, Bangladeshis, Afghanis, Filipinos, and West Europeans. According to the UAE government, the literacy rate is 91 percent for females and 84 percent for males. The United Nations has estimated that the overall literacy rate for the population aged 15 to 24 is more than 90 percent. The government has set a goal of achieving full literacy before 2010.
Prior to the first exports of oil in 1962, the U.A.E. economy was dominated by pearl production, fishing, agriculture, and herding. Since the rise of oil prices in 1973, however, petroleum has dominated the economy, accounting for most of its export earnings and providing significant opportunities for investment. The U.A.E. has huge proven oil reserves, estimated at 98.8 billion barrels in 2003, with gas reserves estimated at (212 trillion cubic feet); at present production rates, these supplies would last well over 150 years.
The Dolphin gas pipeline project was formulated in 1999 to bring gas from Qatar’s massive offshore North Dome Field to the UAE via a 182-kilometer export pipeline. In its initial phase, scheduled to begin in late 2006, the pipeline is expected to carry 3 billion cubic feet per day of Qatari natural gas to the UAE and Oman, almost 10 percent of total world natural gas supplies shipped by pipeline. This project is important to the UAE’s northern emirates, especially Dubai, where natural gas resources are not meeting demand. In addition, the pipeline is viewed as a long-term solution to the rising demand for power and water, because natural gas is the primary fuel for power generation and desalination plants.
In recent years, the UAE has undertaken several projects to diversify its economy and to reduce its dependence on oil and natural gas revenues. The non-oil sectors of the UAE's economy presently contribute around 70 percent of the UAE's total GDP, and about 30 perecnt of its total exports. The federal government has invested heavily in sectors such as aluminum production, tourism, aviation, re-export commerce, and telecommunications. As part of its strategy to further expand its tourism industry, the UAE is building new hotels, restaurants and shopping centers, and expanding airports and duty-free zones. Dubai has become a central Middle East hub for trade and finance, accounting for about 85 percent of the Emirates’ re-export trade. The UAE has been a member of the World Trade Organization (WTO) since 1995, and has one of the most open economies in the region. It began negotiations in March 2005 with the United States on a possible free trade agreement.
According to the UAE government, 15 commercial ports (including oil terminals), as of December 2005, serve the country, with a total capacity of more than 70 million tons. Located in the city of Dubai, Mina Rashid, completed in 1972, is the leading port of the Gulf region. It has modern facilities to handle almost all types of commercial and passenger shipping, including roll-on-roll-off containers. Also located in Dubai, Mina Jabal Ali, completed in 1979, is the largest port in the country and the largest man-made harbor in the world. It deals primarily in bulk cargo and industrial material for the Mina Jabal Ali Free Zone, an international investment haven. In 2004 the two ports had a combined annual traffic of more than 77 million tons of cargo, nearly 65 million twenty-foot-equivalent-units of containers, and 14,000 vessels. The two ports, collectively, ranked tenth in the world in terms of total container throughput in 2004.
In August 2005, the Dubai Ports Authority began the first stage of a multi-year, US$1.4 billion expansion project at Mina Jabal Ali that will increase storage-handling capacity to 2.5 million twenty-foot-equivalent units by 2007, and 5 million twenty-foot-equivalent units by 2008. In September 2005, the Dubai Ports Authority merged with Dubai Ports International Terminals to create a single global port operator—Dubai Ports World, owned by the Dubai government. A new regulatory body, the Dubai Ports and Jabal Ali Free Zone Authority, was created to oversee the regulation and administration of Dubai’s port operations.
As of December 2005, the UAE has 35 airports, 22 of which have paved runways, as well as two heliports. Of the 35 airports, six are international. Dubai International Airport, which now supports 105 airlines, is undergoing a US$4.1 billion expansion. The Abu Dhabi International Airport, which supports 50 airlines, is undergoing a multi-year, US$500 million expansion project; completion is expected by 2006. Al Ayn International Airport, built in 1994, supports 10 airlines, and plans have been made to spend US$20.5 million to expand its facilities. Sharjah International Airport, the first airport to be built in the UAE, launched the low-cost Air Arabia Airlines in 2003 to serve destinations in the Middle East and Asia. The airport handles 1.3 million passengers per year. There are currently plans to spend US$61 million over the next two years to expand this airport’s facilities.
The United States has enjoyed friendly relations with the U.A.E. since 1971. Private commercial ties, especially in petroleum, have developed into friendly government-to-government ties which include security assistance. The breadth, depth, and quality of U.S.-U.A.E. relations increased dramatically as a result of the U.S.-led coalition's campaign to end the Iraqi occupation of Kuwait. In 2002, the U.S. and the U.A.E. launched a strategic partnership dialogue covering virtually every aspect of the relationship. The U.A.E. has been a key partner in the war on terror after September 11, 2001. The United States was the third country to establish formal diplomatic relations with the U.A.E. and has had an ambassador resident in the U.A.E. since 1974.
In July 2004, the UAE enacted legislation that criminalized the funding of terrorist organizations. The law also increased the amount of time that public prosecutors can hold suspects in terrorism-related cases without charge from 21 days to six months. Terrorism cases are referred to the Federal Supreme Court, which may extend the detention period indefinitely.
In December 2004, the Dubai Ports Authority (DPA), which operates the main container ports of Mina Jabal Ali and Mina Rashid, became the first Middle Eastern port to participate in the U.S. Homeland Security Container Security Initiative (CSI) program, which is aimed at preventing materials that could be used by terrorist groups from entering the United States in shipping containers. Under the CSI, DPA employees will screen suspicious United States-bound containerized cargo transiting Dubai’s ports.
