UAE’s long-term vision is a model for success in an uncertain world
Middle East economies that use long-term visions to diversify away from oil dependency, such as the UAE, offer a new model for sustained political and economic success, new research argues.
Growing nationalism and populism in recent years, arising from deep-rooted economic discontent, means that governments need to better focus on enhancing their people’s overall economic well-being, rather than just maintaining growth.
Well-being can include access to better medical facilities, vocational training and education, and technological advancement such as developing sources of clean energy.
“Unlike GDP growth, which is rather easy to track, governments need to be more disciplined in the attainment of other socioeconomic goals,” says a report by Credit Suisse International Wealth Management’s chief investment officer Michael O’Sullivan and macro-strategist Krithika Subramanian.
Their report was commissioned by Credit Suisse Research Institute, the bank’s think tank, on the outlook for global politics, and released to coincide with the World Economic Forum.
Mr O’Sullivan and Mr Subramanian say that to achieve these broader socioeconomic objectives, governments need to be more forward-looking, which often makes life difficult for politicians in many developed countries.
“It is no surprise that the model we highlight is found more often than not in stable, consensus-driven countries,” they say. “Countries such as China and the UAE, for instance, have been able to build significantly better infrastructure than India in a shorter period of time.”
Last year, Sheikh Mohammed bin Rashid, Vice President and Ruler of Dubai, announced the UAE Centennial 2071 plan aimed at sustaining the country’s development into its 100th anniversary.
The plan includes developing a government that prioritises the people, invests in education, establishes a diverse economy and promotes tolerance and social cohesion.
For emerging economies such as the UAE and Saudi Arabia, improvements in institutional quality and subsequent economic progress is being helped by their long-term visions.
“We increasingly see this as a driving force for more holistic changes,” the report says.
Saudi Vision 2030, led by Crown Prince Mohammed bin Salman, includes the sale of a 5 per cent stake in state-owned Saudi Aramco, reforms granting women greater mobility and the rapid development of tourism and entertainment sectors.
But the most consequential change in global politics today is concern about American dependability, particularly in the Middle East, says Prof Nicholas Burns of Harvard University, a former US under secretary of state, in the report.
As a result, one of the key issues to watch in the year ahead is whether countries in the Middle East “can manage to contain the powerful forces that make theirs the most violent and unstable region in the world”.
With America’s traditional role as a bulwark in the region less certain and Russian and Chinese influence growing, it will be left to Saudi Arabia and its allies, including the UAE, to take greater responsibility for resolving crises in Yemen, Syria and elsewhere, Prof Burns says.