Economic integration is key to Gulf stability

GCC nations can lead the way to implement a clear and executable Arab economic vision

The year 2015 is not shaping up to be economically stellar for most of the world. Falling oil prices, a possible “Grexit”, and a slumping Chinese economy all have the world on edge. The UAE is one of the few exceptions to that rule with major projects and new initiatives such as the drive to push both an innovation economy and an Islamic economy, keeping the country’s Gross Domestic Product growing comfortably. The country would not be in this position unless steps had been taken over the past 40 years to diversify the economy away from reliance on oil.

His Highness Shaikh Mohammad Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, addressed that on Saturday when he released a note on the UAE’s economy. According to the note, the UAE’s non-oil sector now accounts for 86.6 per cent of constant-price GDP, and the country is looking to extend that contribution to 80 per cent by 2021. However, as Shaikh Mohammad points out, a more pressing need is the need to achieve economic integration in the Gulf, which would help ensure the stability of the whole region.

“The major challenges facing the region make it a necessity to implement a clear and executable Arab economic vision, launch significant economic projects, and utilise the human and natural resources of the Arab world more effectively. We must address the imbalances of the region in a comprehensive manner, covering economics, politics and security,” he wrote.

Economic integration has been a long discussed issue in the Gulf, but it is now time to act. If the UAE can double its national production in just 40 years, imagine what the Gulf could achieve as a whole. It could raise its standard of living to some of the highest in the world and provide jobs for millions.

If the Gulf fails to achieve this, then many of the ongoing security concerns in the Middle East will be much more difficult and costly to defeat. Given the options, integration is clearly the way forward.