the united arabandbookm
-PHItlP-cr- WILCOX,'JR.'" DEPUTY" ASST SECRETARY, .
Directorate of Intelligence
The United Arab Emirates:
Central Military Command
Common Ground With Other Small Gulf States
UAE and the Gulf Cooperation Council
Again at Other Arab Countries
UAE's Importance to the United Stales
The United Arab Emirates: a
The United Arab Emiratescollection of small shaykhdoms perched on the southern Persian Gulfa stable, prosperous country. The UAE"was formed] when the United Kingdom's decision to withdraw its security guarantee to several Gulf stales led the emirates of Abu Zaby (Abuubayy, Ash Shariqahmm al Qaywayn, Al Fujayrah, and 'Ajman to federate- The emiralea's al Khaymah joined the federationhe discovery of oil inave the emirates the. economic capability to rapidly modernize and provided their citizens with one of the highest standards of living in the world.
ibu Dhabi and Dubayy are the two largest, most populousTand wealthiest emirates. Abu Dhabi controls most federal institutions, including the federal armed forces, and dominates UAE foreign-policy decisionmaking,etains its own military and police forces, and its economy is independent of that of Abu Dhabi
The UAE's economy remains linked to ihe world oil market despite recent efforts to diversify. The federation's large oil reserves allow it toong-term policy of trying to keep prices low to encouragean and Singapore are the UAE's most important trade partners. Foreign assets also provide significant income- NaturaLgas, manufacturing,and banking artgrowing in importance lo the UAE economy, bul they arc dwarfed by ihcottll sectors of the UAE's economy depend heavily on expatriate wor kc:
The UAE is suspicious of its neighbors, especially Iran, bui ii has little choice but to rely on diplomacy to avoid confrontations. The federation worries that Iran threatens the security of its putlying islands and oil installations in theuspicion that, lingers despite recent Iranian efforts tooderate .image in the region. Saddam Husayn's Iraq also is feared, but its distance from the federation majces it less threatening in Iran. TheJJAE and Saudi Arabia have grown closer in recent years,
many of its relations in light of alliances that formed during the Gulf war. The federation's commercial focus and, military weakness icac* il to rely on accommodation in its foreign policyj
Land and People Topourapby
Almost all of ihe United Arab Emirates QUAE) consistslat coastal plain along the southern littoral of the Persian Gulf. Sand dunes rangingeters in height cover most of the plain. In the south they merge into high, linear ridges called seif dunes. To the west numerous escarpments and coastal salt flats called sabkhas break up the plain. Sablchas also dot the coast between the escarpments and the cities o! Abu Dhabi and Pu'sayv ajphe southeastern part of the country^
Higher elevations are found only in the northeast, where the Al Hajar Mountainseighteters above sea level. Gravel-covtred plains slope down from the Al Hajar Mountains on their eastern side, reaching the Gulf of Oman. On thewestern side, sand and gravel washed out from the higher elevations foim gullies thai fan out onto the plain below. At lower elevations sediment-filled valley floors are in turn dissected by steep-walled stream channels
Freshwater resources are scarce in the.UAE.and desalinated seawatei supply most of the federationurfacewal.cxis availableuring the winter months, principally in the Al Hajar Mountains, where it is used to support local agricul-
Total groundwater resources are estimated to be neatlyillion cu bic meters,e-quality of the groundwater varies greatly. Coastal aquifers, situated beneath thecouatry'i major popuUtion'eenlersiter demand is high, are chronically overdrawn and ate becoming increasingly contaminated by theot saltwater. At present rates of extraction and 'epleimhftienl. potable groundwater resources may be M'xwvli depleted
Depletion and contamination of groundwaterhave forced the UAE lo turn to desalinationiu CHinLCipal and industrial needs and mayut teiiou water sborutges in the future. The
Ytine cW.tnaiionuse theftavh process and two the more sophistical-^eiw tamosiitogether produce
'Temperature information gathered al Falaj al Mu'bIIb Station.
bThc UAE hu hot summers and mild, dry winters. Il is not unusual Tor ihe mote arid interior lo be completely without rain toi several yearshemall amount of rain (alb mainly inmountains ofEmirates between November-arid May; snow it unknown. Annual rainfall canin these higher elevations. Temperatures in Ihe Emirates can range from betweenegrees Celsius andegrees Celsius in the summer andegrees Celsius andegrees Cellu* in the winter with January usually iheonth
illion cubic meters of potable waterto government infbrmation^he UAEits water
' Multistat* ftaih desalinationistaltalioa process in whichii boiledlighi vacuum and ihe vapor is separate) and collected. Reverse osmosis desalination Involvesseparation fWxu intesurued saline solution it separated from ihe dissolved raateriab bythrough a
construction and repair of desalination plants, more efficient irrigation methods, and reduced domestic water consumption will be necessary to avoid severe water shortages within the next two decades j
The emirates along the Persian Gulf littoral became independent and formed the UAE after the United Kingdom ended its treaty relationship with themollowing prolonged negotiations, six emirates announced they hadnionay after they became fully independent from the United Kingdom. The seventh emirate. Ra's al Khaymah, joined the federation inll the emirates hoped that federating would improve their individual securit
itnessed the transition of the UAEackward group of emirates to an increasingly secure federation. Abu Dhabi and Dubayy began exploiting their oil leserves during, which gave them the wherewithal to modernize their emirates. In thehe UAE developed working relationships with its immediate neighbors. Saudi Arabia and Oman. Relations with thesefurther improved in response to perceived threats posed by the Iranian revolution9 and the Iran-Iraq war. Throughouthe UAE's standard of living increased rapidly, and the federationthis trenddcspjle the plunge in oil prices in :he. _hhi
Despite th* increasing cohesiveoess of ibe federa--liortlhe UAE remainsloose coRfederation of -traditional shaykhdoms. Individual ern:ratc rulers, not the federal government, make molt of the important decisions. The two largest and mostemirates, Abu Dhabi and Dubayy cooperate onpolicy but retain separate economies, militariesrand police forces. The northern emirates, which depend on the largess of Abu Dhabi and,esser extent, Dubayy are reluctant to yield political sovereignly!
Profiles of tbe Se*en Emirates
abL Domir-ating tie federation. Abu Dhabi is the largest and most powerful emirate in the UAE. Abu Dhabi holds the UAE presidency, dominates, tbe UAE military, and takes the lead on foreign policy. Abu Dhabi also contributes most ol the federation's budget and subsidizes many of the poorer emirates. Oil wealth provides Abu Dhabians with one of the world's highest per enpila incomes, and the emirateenerous welfare net for its citizens.!
Mate Eeemts In UAE History
centnrj. Portugal establishes fons along ike Arabian Peninsula eoasl to protect its trad, routeshe Indies.
ritain and Holland ally to reduce thenaval presence In the Gulf. Holland remains the dominant outside power in the region for the rest of the century.
he Al Bu Fatah clan afthe Bani Yas tribe settle in Abu Dhabi town.
he British East India Company reaches on agreement with the Imam of Muscai that allows an armed Brilish trading settlement atAbbas. This move represents ihe beginning of Britishin thr region.
he British shell Ras al Khaymaheries of increasingly bloody skirmishes with the tribes af the Qowasim federation, who ruled Over what became ihe emirates af Has al Khaymah and Sharjah and dominated the area thai now makes up Ajman. Vmm al Qayayn. and Al Fujoyrah. The shelling signals the beginning of ihe end cf Qawesim
-dominance in ihe regfon.Tdc6nlaifrihehe British occasionally worked wiih the Bani Yas tribal grouping, who hod emigrated from the Arabian Peninsula's interior in iheh century and '
_ sealed in Abu Dhabi and Dubayy^ The current ruling families of Abu Dhabi and Dubayy areoflhe Ban; Yas. and the rulers of Fa's al Khaymah and Sharjah
- are of the
h cenlVry.'Piracyagainst British Aipping increases to ihe point thai British cartographers label the region the 'Pirate Coast."
ritain and local shaykhscriiime truce. Ofien unable to comeamong themselves, the shaykhs agreeBritain settle iheir disputes. BriiUhihe region ihe "Trucial
ayid the Great consolidates Bani Yajin the Al Burayml Oasis.
ritain and ihe Trucial Stalesreaty forbidding ihe shaykhs io enter imo relaiions with foreign governments or dispose of territory infor British protection.
il is discovered in Abu Dhabi.
haykh Zayid bin Sultan assumes power in Abu Dhabi Oil is discovered In Dubayy.
he United Kingdom announces it will end iis treaty relationship wiih the Trucial States
ist Trucial Slates form the United Arab Emirates.
Ra's al Khaymah Joins the federation. Sharjahmall amount af oil.
he UAE Joins ihe Arab oil embargo againsl the United Slates and other Western countries.
audi Arabia and the UAE reach agreement on their disputed border.
he UAE joint with Saudi Arabia, Kuwait, Oman. Bahrain, and Qatar to form the CulfCouncil.
Dubayy. where the Al Bu Falasah branch of ihe Bani Yas tribe had recently tetiled. declares its independence from the Al Bu Falah clan of Abu
bds of Shorjoh ailempls ancoup against his elder brother. Sultan, wiih the approval of Abu Dhabl^ubayy and Saudi Arabia tacitly supportB
eries of skirmishes with Britain, leading shaykhs agree to end hostilities at sea.
ruling Al Nuhayyanranch of ihe Al Bu Falah clan or.ihc Bani Yas tribe, tracesheriginally bedouin, they
."'i.bL'i^lbc. A1 Buraymih andl9th centuries. Before the discovery of oil in.the, control of the water resources of the inland oases was the economic base of Al Nuhayyan powa^H
Dubayy. Fiercely independent. Dubayy is the most open and energetic.emiratehe federation. Du-bayy's ruling Malciuroranch of the AI Bu Fabsah clan of the Bani Yas tribe, migrated from
Abu Dhabi and established itself along Dubayy Creek during. Dubayy's excellent port attracted merchants from Iran and India duringhh centuries, and the emiratearge non-Arab population even before the discovery of oil brought an influx of foreign workers.the Mak-!umecure economic
Fit* Sortkera Emirates. Lacking Substantial oil revenues. Abu Dhabi's poor relations, the five smaller norlhemRa'i al Khaymah, "Aj-man, Urns al Qaywayn. and Allimit-od in lerms of internal development and influence within the federation. Their.financial dependence on Ihe richer emirates,particularly Abu Dhnbi, ties them to the federal institutions. Their small site andhelp the emirates retain their traditional cha acterj
'Ajman. Umm al Qaywayn. and Alsmallest and poorestsometimes likenedillages with administrative (unction* exercised byantfuipfDeopJc. Most administrative reforms undertaken in tbeecades were prompted by the need for coordinaiioc with federal dcveloprnen', projects. AdmmJMiaUQE in these emirates isbecause they have enclaves Inside the lerrilory of other emirates. The enclaves characteristically contain villages, dale palm oases, or grating .
Sharjah. The emirate of Sharjah. which oncepecial status as the center of the British presence in the Trucial Stat
er of relative
progressivism" in the conservative federation,eeause-of.thejruleilian> support for Pan-Arab and modern5 Sharjah was the first emirate to adopt the UAE nag and transfer control of its militia, police, aod courts to federal jurisdiction.
Ra'i al Khaymah. Located on the shores of the Strait "of Hormuz. Ra's al Khaymah has one of the longest political histories of the seven emirates. The emirateajor trading outpost during tbe eastward expansion of Europe's trade routes inhlis ruling family. theQasirrjis. has controlled the Strait-of Hormuz since. Ra's al Khaymah de-'ayed joiningfederationthat the discovery ofoil would provide thebasis for Ra's alope that was quickly dashed
Oil wealth has radically changed the face of UAE society. Onceoneof the world's poorest areas, the UAE's per capita GNP now is among the world's highest, and the government has established awelfare state. Before oil production began, UAE society wasjyer_whelm]ng|ynomadic.the UAE's population is .preponderantly urban, and excellent roads connect remote locales throughout the fedei MB tribesmen found employmentoil companies when production began, and considerable numbers later found employment in construction or serviceUniversal education, an active local press, and televisjoiicontinuc to broaden the horizons of Emir-
elements of the bedouin way of life linger LQn?-'dc thcbrought by
nitj, and.the extended family remains the UAE's strongest arid mosLcohesive'social unit."in thc^AeX often: follows'the Arab tradi-
nof consensus JBIH modest plans tojmproveits economy Tbe emirate" ^marriagesiversified dcveToomeni^rhiecJc andru' vTtl 'i'J.
elegations from sides discussed ways* to facilitatei trade.l
arrangedrhal social grouping. An ideal marriage iioung man and his uncle's daughter. Youths exposed to ke'RaYal(u- Western culture generally return home to theirayraii nasa motresT income derived from mineral Hies and remain obedient to their elders, who almosthave oil or gas. AIFujayrah universally lack formal educati :sees itself as an ideal trade locatioo, outsidelae Strait"of Hormuz but well placedenter for Gulf trade. ReligionAl Fuiavrafi-courts"Iranian commercial tfes.
The majority of. UAE citizens are SunmNIusIims.hia minority comprising.roughlyercent of the native population. The majority of Emirian Shias
id are[most emirians identify themselves aso afjlisis emirians. islam is the dominant identity, and)
. v sectarian clasheit(^fc
he uae goveniment.follows islamk sidelines bat - ore tolerant approach than most other gulf. states. everyone in tbe uaec including visitors.is subject to islamic law^whkh forros thej_ basis of the uae's judicial_code. uaeonc fori _xj^ fcayid donated thelan^torseveral chris-
ttlwrturches in abu-dhabi. in addition, leading . overnment religious officials do not try to curt iii non-muslim religious acimtu
The traditional role of women in the UAE ii shown small signs of change]women In the UAE traditionally haverucial rolf within the homerbucihey have generally exercised IJiiJtJnfluence in politics or business. UAE women, however, ore increasingly well educated, and many no_ longer accepljxrranged marriages The number of UAE women who work outside the home, while small, is steadily increasing^ In the fall0 the XJAEmall number of women Into Us military, thefirsi such move by any Culf
UAE: Population by0
he population of the Uniled Arab rates, incraaiflg foreign workers, isillion, aboutercent of whom reside in the emirates of Abu Dhabijndhe UAE's population isjrowt.it at an annual rate ofercer HHRBV0HHaB|VcActing continues immigration of large numbers of foreign workers. The period of rapid population growth began in theesult of the expansion of the UAE economy, which attracted large numbers of JkXW HT
in the'UAFOUtrjulribeynative Emlfians byo I. and the expatriate (hare of theion has been increasing. The population of foreigners has quadrupledhile that of Emirians has only doubled, UAE laws preyeajing most semiskilled and unskilled foreign workers from bringingamilies into the UAEJave-ledPlate.expatriate* in the
foreigners. Tbe UAE's reliance on foreign workers grew alongjiiith its economy, primarily because the indigenous workforce was so. small. The UAEpopulation waiestimated0 toridjis_dislr<bution was as follows:
UAE: Labor Force and Population
Nearly three-quarters of the UAE's foreign workers are Asians, employed primarily ja semisUlled and unskilled jobs.ore thanercent of the work permits issued to foreigners were given toinc1 PacmatusJfl BBbXHBsWWaapaVfJBMUhi
majority OT tmiriacs work for the govcrn-rneff because it offers higher prestige thanrivate business. Many important positions in both the private and publicsectors. especially onesspecialized knowledge, arc occupied by skilled expatriates. Cultural attitudes cpniinuc to discourage most Emirian women from working despite the UAE's official encouragement of participation by women. I-
Foreign workers are attracted to the UAE because there are no taxes, health care is subsidized, and most jobs come with either free or subsidized housing.
Highly skilledoften earn premium talar.
wages foi unskillecTworkca arc quiterejs oo minimum wage. Many illegal workers bold jobs in the UAE despite the close monitoring of tbe foreign labor force. The Ministry of Labordeports thousands of illegal workers each year.
The governmenl is trying to reduce the UAE'son foreigners, but it has.mel with only limited success.0 Federal Labor Law requires that businesses ancT|Overnmenlrriinistries train andEmiria ns wheneverpossible. Recently theof Laborystem for registering
UAE: Labor Force0
seeking employment.rospective worker registers. Ihe Ministry seeksaDctes-in the private sector and "suggests"to businesses. The government alsohigh birthrate among Emirians. which is now atercent, by paying nationalsonthlyper child.
Although the UAE's economy and military would not function without Urge numbers of expatriate workers, they are second class in status. Many expatriates in the UAE have spent their entire adult lives there but
Education standards among the indigenous population in the UAE are rising rapidly and probably will remain high for the foreseeable future.3 the UAE's only schoolsew; attached to mosques. Since then, educational facilities have been establishede coujmyjbr both citizens and temporary residents. The literacy rate among
the education of many UAE nationals in the United States.AE nationals studied in the United States
Three technical colleges not associated with the UAE University were established8 to provide Emir-iarts with the managerial and technical skills required to wean the federation from its dependence on eipa-
these institutions is open only to UAh nationals. Men's and women's campuses are open in Abu Dhabi. Al 'Ayn. and Dubayy, and other branches are in the planning tfage. Total enrollment0
students study overseas]
ch majorjnics as the Abu Dhabi NationaiOil Company and the Abu Dhabient Authorit
The leading UAE daily publications include:
-emiofficial publication whose editor in chief is tl^edcra^icn's Deputy. Ministeronl^
?he papera subsidy from the Ministry of Information. Nationals from Abv Dhabi, attracted by thenper's loealcoveragc. comptise the bulk of the readership.
Al-Bayan, the semiofficial publication for Dubayy. This paper receives subsidies and guidelines from Dvbayy's government similar to those Al-liiihad receives ftom Abu Dhabi but focuses on trade and
economic issues, reflecting Dubayy's commercials typical reader is an Arabic-speaking national or expatriate, well educated,usinessman.
two-lane hard-surface roads. Secondary routes of crushed stone, unproved earth, or natural surfaces conned ma(or routes to remote nomadicack of bypass routes causes congestion,'and shifting sand dunes occasionally restrict overland passage!
Modern and efficient airfields facilitatraffic and consumer trade
fields, five of whichijternattonat traffic..
Seven major ports and numerous secondary ports facilitate the bow of goods in theX'AE. Mina" Jabal *Ali in Dubayy is the largest port in ihc Middle East, with0 meters ofdeepwater berth wharfage and alongside depthseters. Mina' Zayid, another major commercial port and naval base, is located in Abu Dhabi. Otter main ports include Mina" Rashid, Mina' Khalid. Mina' Saqr, Al Fujayrah, and Khawr Fakkan.1
airfield is under construction at Ai 'Aye. Several secondao^irfidds treuscd primarily by oil
The Emirate Telecommunication Corporationthe UAE's sophisticated publicA mixture of coaxial, cable andrelays makes up the network, and ihrcecables connectE to Bahrain.and India The UAE operates threeassociated with
The Ministry of Information and Culture directs all radio and domestic television broadcasting in the UAE- Five different facilities broadcast in Arabic, English, and Urdu on medium'Wtve. FM, andradio.OO registered television sets receive programming fromjwo television services that transmitgramsUwu-in Arabicgne inand one in Arabic. Englishjnd_EuCfh.dishes are becoming increasingly common, espe cially among wealthier Emiria
The UAE federation.ean oldoose cwfeoeratton of traditionalach of the sever, ruling familiesovenis its emirate with little interference from the federal government Abu Dhabt and Dubayy. the two largest, mostand wealthiest emirates, cooperate on foreign policy and several federation wide programs but retain separate economies, militaries, and police forces. The northern.emirates arc bound lo the federation byreluctant to yield political sovereignty
The emirate of Abu Dhab: dominates tbe UAE. Abu Dhabi holds the UAE presidency, directs foreign policy,he federation's leading.oU producer. Of the other sii emirates, onlyUAE's commercial centerignificant, oil producer in its ownsuccessfully steered an independent course from Abu Dha'bi on_securiiy aod economic matten. Dubayyan officials hold the positions of UAE Vice President and Prime Minister]
Decisionmaking within each emirate is prirr.iril fined to the ruling family. The rulers or each cr hold power on the basis of their dynastic ppsitic their legitimacyystem ofus. The UAEhasnq political panics or signifi opposition groups.,"
Deetsioeunakirrg In tbe UAE
Po: in the UAE is characterizedomplci dynamic between the ruling families, of the seven member emirates. Eacb emiraterulet_*eci> to retain
his auionorny while reaping the economic and security
benefits of the federation Because their.strongposition .gives them economic leverage over the poorer emirates, the ruling families of Abu Dhab^nd Dubayyeading role in the federalicr.^
- Each of the seven ruling families is without rivals for power ir, its own emirate. Relative* of tbe rulers hold virtually all prominent positions injovernment and business inthe federalAll the ruling families,_along with most major merchant families, are closely linked to each other
throughraditional method of ensuring that potential rivals are part of the extended family. AH tbe emirate leaders are. isolated from public criticism. Abu Dhabi'subayy's leaden are especially secure, beifig abie to satisfy the economic wants of their peep!.t
Lacking significant petroleum reserves, the smaller northern emirates rely on Abu Dhabi to subsidize their cconcrr.iesl
uccession lues amy, leaving incgyjouai emirates to deal wi ol successions ccor ding to their own practices!
Bhe federation's legislative and exec-uuveTranccfl^ffij key ministries bave little influence on local decisionmaking. For example, the Ministry of Finance cannot collecLrevertue. and tnc.Ministry of Petroleum has lilt tcja.fluea.ee on UAE Oil production.
Cooperation Limited Between Abu Dhabi and Dubayy
[The leadets of Abu Dhabi and Dubayy have different agendas and do not^cooperate on many important security andu Dhabi's wealth and prosperity are based almoat entirely onwhile Dubayytrong commercial sector.
The discovery of oil in Ihcransformed the UAE into one of the world's wealthiest countries. Per capita income in the UAE is now among the highest in the world.9 per capita mcome forUAE has used its oil wealth to provide benerusTor its. ciuzensjuch. as free health care and education and to develop the federation's
The strength of tbe UAE economy is closely linkedin the international oil market. Theexpanded dramatically with the, but during the oil glut ofat an average-annual rajehe UAE has,tried to diversifyw induce this vulnerability, expandingrefining, barddng, gas-production,areas, but oilore importantincome than all of these other sectorsgovernmeet is the largest employer in tbeeonsiiuction industry. Otheroccupationrarein the petroleum andagriculture, and
* Energy Sector
UAE: Real GDP
81 E 83 &4 ti
growihm the UAE hai Oucruaied widely from yea. io yearemit ofiwinp in the price of Oil. Durtntthe. dramatically, real GDP rose al an average annua] rate of overeroiu. fXirinx. tesJ GDPaje oferorm annually, lugcfy because cJieculive de'dinei in'and aat crmatrol fill6 in rraoonae io
^loaeiT-wiin uiai or aauoi Arama.rerxcung annterasn-io^prOBiotinK.makers generally believe oil that is loo expensive or '
.erratically. priMTwod to search7or alternative energy sources pronsumption through conservation, damatint tbe -UAE's income in tbe long
US years at current lliori barrels per'day production. The UAE's; Provisional Constitution eenone of theeaves control of oil production in the hands ofign iu oil policy individual esfirjuesr Aby Dhabi; [Tibe only emirate
that some timesreduces production to comply with the federation.'i UPET^uouT All*the other emirates produce at full capacity.
Abu Dhabi is the source of aboutercent of UAE oil rjroduction. each .emirate seu its own oil Policy, and there is litileJn^exururate coo/dination of
Abu Dhabi produced5ale probaNyj.il] msiain ai leait for ihe neat few years.
Abu Dhabi. Crude oil production remain* the prime
Abu Dhabi's economy. Abu Dhabi contain*ercent of the federiUflllibillion barrels. Although official figures forhabi's GDP are nothabi's revenues from oil producuongenerate^ooul one-third of the UAE's GDP. In
Dubayy. Oilpercent of Dubayy'*
GDP. Crude oi) production in DubayyITis tbe limit of it*
production capacity^elatively modest when compared to
Abu Dhabi's and would last aboutears if there
are no additional major discoveries.
TheiVorthern Emirattt. Unlike Abu Dhabiubayy, the northern emirates have small oil reserves. Sharjah't first oil discovery inoffshore
Haqllurry ofevelopment spending in theuta* been disappointing. Half of the field'* neluo go io Inn, which claim* thai part of ihe field i*
percent to Umm el Qaywayn, and 10
'Ajman/SharMeurfenjJy produce about. including condensates. Umm al
Qaywayn, like Sharjah, was disappointed thatperceni share of thejbarak-field did not
.wealth. Ra'i al Khaymdk struck oil inattic SaTihJeJd. which is locatedilometers so"uThwest"of"the Strait of Hormui just Inside tbe offshore boundary with Iran. Production
the field0 was about.roduces no oil or gas. but! I Vsacoui prospecu ilonj
of Omar: coast.'Ajman would Lie to become involved in the petroleum industry beyondpercent sharehe Haql Mubarak oilfield and is *eekin'g to obtain
,tes. Abu Dhabi possesses JJijrillion, cubic feet and .Eastern producerarjah has gas reservesand_Dubayy also has ent rates ofor centuries.era tedillion
cubic (eel per day.
increase in ihe coming
mostly in ihe form ofaccount forsercen1 of the UAE's total exports
Refineries- The UAE's three refineries arc located in Ar Ruways. Abu Dhabi, and Ra's al Kbaymah. Gas-processing facilities in Abu Dhabi. Dubayy. and Sharjah can produce some |tons of liquified natural gas and gas byproducts. Thesealso contribute byproducts used in theof chemicals and petrochemicals at severalcenters.!
Industry. The emirates of Abu Dhabi and Dubayy have encouraged (he development of energy-intensive industries, taking advantage of their plentiful and cheap oil and gas. The fcderalion has two chief industrial areas: Ari|pmeters west of Abu Dhabi city, and'Ali.ilometers west of Dubayy city.FacJIities at Ar Ruways produce fertilizer,ons per day ofandons per day of urea. The emirate hasrain silo, flour null, and animal feed complex at Ar Ruways. Al Mint"melter producesons of high-quality aluminum annually. This complexajor international drydockarge free trade zoni
the other six emirates, manufacturing is less devel-oped^mploying lessercent of the population.
Agriculture. Several major obstacles limit theof the UAE's agriculture sector. Water is the key constraint.atillion cubicbeingnilhoriciibicm^ per year,
counts for about tnree-quarteri of total water usage. Poor soil quality and extreme climatic conditions limit ihc area suitable to agriculture. The small size of UAE farms, price fluctuations, poor emirate-federa-lion coordination, and ineffective marketingalso inhibit agriculturalj
Despite these constraints, UAE agriculturalhas expanded considerably since independence, and about one-quarter of the foodstuffs consumed locallyarc produced domesticallyfood production, and the UAE may soon achieve self-sufficiency in poultry, vejenables, and most fruit. Vegetablerose by anavcrageercent per year for the first eight years of irsdependencejnd cultivated land expandedeiccoiior tbe periodhole. Crops mos< commonly cultivated include dales,apricots jnangos. almonds. limes, and other citrus fruit
diversify the economy, the government is encour--aging manufacturing, which cuwenOy-eomprises about'lO percent of GDP. As in the oil sector, the emirates pursue their own development strategies in manufacturing. Abu Dhabi is thejagship emirate for manufaciurjn|;Srnflt|.erDu^gtcj)wned enterprises . anufacture cement block, pharmaceuticals, asphalt, -jjaimTand plastics. Abu Dhabi enterprises alsohips and mill flour. Several small private industries have been established in Abu Dhabi, including softmanufacturing and bottling, icemaking, and fabrication of windows, doors, and shop_littings. In
Most cultivation occurs in and around the Al 'Ayn Oasis and in the valleys of the Al Hajar Mountains in the eastern UAE. where sufficient water is available. By thehere were more0 farms, although most were no largerectares.and modern irrigation systems cover00 percent of cultivated lar
Fishir..less than one-fifth
of Ihe native population oTlhe emirates relics on the sea for their livelihood. From. September until March.
titanThe Government itieulalii SW
million*tearutiiJin wait'andIrritationlyiitmi. toeeo^idi ftriitiirr ami md at lin than half ihe coif, and toatailahli ig eimlfa/miriwith initial imetlmeni et
tieund ITitJr^thcS trait of Hormui and
survey conducted in theeborn meJ lhat ihe UAE upgrade the storage, berthing, and unloading facilities (or its fishing industry, but little hat been done primarily because the fishermenhave not pressed the government to change the existing syster
uilding boom in tbehat produced more new construction than was needed, and borrowers had trouble repayir$anking crisis resulted, prompting the UAE Currency Board to suspend the esublisbment of new offices by foreign banks.1 the Currency Board's more powerful successor, tbe Central Bank, dictated the closure ofuch branches andimit of eight branchesr.k
and Finance. The UAE has longeputationulf banking center, but bankproblems have led the government to reduce the number of bank branches operating in the fedetalion. Drawn by the country's oil boom, foreign banks flocked to the UAE in. By the end of thethereankf which belonged io foreim banks. Overextension of credit
Today ihcre are overanks operating in the federation, including banks from the Unitedthe United States. Pakistan, Iran. Canada, and India. Many of the banks have branches, notably in Abu Dhabi and Dubayy._ln addition, there are local money-changing esyblishmcnisknown as larafsin the marketplaces.^ ^
Then the UAE* billion of pr lector depot froien In thi bditpafiheht the BCCI. a
unking regulator- In the United Kingdom, the United States, and five other countries froze the astett of the Sank of Credit and Commerce Internationaln international bank in which the government of Abu Dhabi and Us leader ShaykM Zayid were majority shareholders. The regulators actedank of England reportloted massive fraud-ihlhe'bahlT Press reporting suggests' the BCCI has been involved in financial transactions linked to narcotics, terrorism, the gray arms market, lax evasion, and capital flight}
nclal Impacthe private-
tkeJJAE bankingeight local branches. The crtdl-ikjjf-Credjt and Commerceercent owned arid managed byBCCE has renamed itself the Union national Bank and. after dirrci government of Abu Dhabi support to cover theunds frozen in BCCI. has been running smoothlyi
Foreign Trade and Payments
Petroleum accounts Tor over two-thirds of the UAE's export earnings and is primarily shipped lo Japan and Singapore. Other important exports include natural gas, dried fish, and dates. The UAE.arge vojume of goods io_otber Persian Gulf states. Since.jnderxndence. reexports have grown by an average of IS percent annually. Reexports are being threatened as other Gulf states developort facilitt
Construction goods are the UAE's largest import, averaging aboutercent of spending on foreign products in the past few years. Other major imports include household appliances, air-conditioners, tcx-tiles..foodstuffs, and cigarettes.maller scale include cosmetics, watches, andequipment
The UAE hasrade surplus since it was establishedil exports account for tbe majority of the UAE's trade. but_joverninent efforts to "diversify the economy have ledubstantia! rise in nonoil exports. Nonoil exports have increased fromillion2 to aboutillionn average of about lokKrceni growth per year. During that same period the value of oil exports grew by an average ofercent annually]
Trade and Cite
tWt*alefaur and realanndustry 8J
> ot t
O*man federal armed forces of the United Arab Emirates is struggling to improve its capabilities and to modernize itshe federal armed forces participated in Operj^orirjcscn Storm but
the UAfc's forces did not participate in ther and remain uniestcd and unfamiliar with modem warfare. Abu Dhabi is planning major arms purchases to modernize the military, seeking belter tanks,lighting vehicles, artillery, and aircraft. The UAE is hoping that tbe United States, amongothers, will help its military to learn tocffcctivc'y employ this equipment j| |f
The federation would like to reduce the number of expatriates in the armedcomprise aboutercent of theits small population and lack of technical expertise will preclude independence from expatriates.
m self-propelled artillery pieces, viewed by some as one of the best artillery pieces in the world, The military continues to evaluate different infantry righting vchicleSjbut it has made no'decision as to which one to-
te complex systems will require more train-ing than the armed forces arc conducting currently.
The Air Force
The Air Force, the military's highest priority during, has aboutombat aircraft, which are primarily irue^edjc^rcrvjde air superiority and close air
UAE foreign policy reflects the federation'semphasis and strategic vulnerability. Dubayy's late ruler Rashid bin Maklum once summed up his agenda as "business first, last, andair characterization of the UAE's general priorities. When compared with its immediate neighbors, Iran orrabia, the UAE's population is small and its military weak.]
These concerns lead the UAE to rciy cnin its foreign policy and ignore minor slights. For example, the UAE has not gone beyond rhetoric in challenging Iran's seizure of several islands that the federation claims. The UAE often lets Saudi Arabia take the lead in confronting threats to the area or works in concert with the Culf Cooperation Council to avoid being singled out for criticism Torotentially controversialuring the Gulf war, the federation was angered by what it saw as Tokyo's meek support, but this disgrun:lenient diet net prevail over economic concerns because it increased trade with Japan during that period
demise. Iranian teitbooT?continue to print historical maps of greater Iran lhat include all of the UAE's territory f I1
Iran has threatened the UAE's territorial integrity since the UAE was foundedwo days before the Trucial Stales announced they wouldederation, Ihc Shah of Iran seized the Tunb Islands from Ra's al Khaymah and wrested effective centre! of the island of Abu Muta^gm Sharjah. Iran regains control over these isl
The UAEoljc diplomacy with Tehranj
the UAE hopes thai strong commercial relationsencourage Iranianhopes that, even if Iranian
radicalism continues, such tics wiil avert Iranian aggression while providing the federationucrative market. The UAE did not follow Saudi Arabia's lead and break diplomatic relations with Iran during
uubayy's largest nonpil trade partner. Berause of Dubayy's relatively modest oil reserves, it needs the trade with Iran to maintain its economyj
Despite its preference for accommodation andthe UAE seeks to improve its military in case diplomacy fails. The UAE is modernizing its military
UAE believes Iran is the greatest threat to its territorial integrity. Tjwjeacraiion's oil facilities.
1 The Gull Concern on CwmII wm formed1 ByE. Saudi A'ibia. Qitir. Oman. Bantam, and Kuwait WKK
The UAE.perceives Iraq as much less threatening than Iran-Iraq's aggression against Kuwaitand iftlgered UAE leaders, but, they believe the UAE's distance from Iratymakcs the prospect of an outright invasion remote
Iraq has less Influence on the UAE economy thanIran and has fewer natives residing in the emirates to stir up trouble from the inside.
The UAE is likely to shun Iraq for some time if no regimeere that rejects the policy Saddam Husaynj
mirians remember thai,.before invadingSaddam threatened the UAE for exceeding its OPEC quota, and0 Baghdad radio warned Abu Dhabi lhat. if it did not recognize the puppet government in Kuwait. Iraq would attack the
Despite the UAE's distaste for Saddam's regime, the federationtable. Supni-dominated Iraqsefu(^sjancejgainst Iranian domination of the
Iranian Residents in the CAE: An Unlikely Threat
The UAE's larti Iranian population poses little threat to the current regimeminans are of Iranian origin, and atranian nationals Hue in the UAE. Many among both groups maintain family ties to kin in Iran. Few Etnirlans of Iranian deteent or Iranians working in the UAE embraced the Islamic revolution Iran or responded to calls for religious radical is
descendants of she targeof IraniaHTwho migrated to the UAE early in this century enjoy the full benefits of UAE citizenship and are primarily concentrated in the commercial sector. Many Iranians arrived after the revolutionnd most of these oppose the Islamicin Tehran. In addition, the Iranians residing In the UAE come from different parts of Iran, which reduces their ability to
Common Ground With Other Small Gntf States
Crowing economic ties and similar political outlooks are leading the UAE and Oman to graduallytheir past animosity. Many sources of tension during, such as Omani cooperation with the Shah of Iran and Omani fears that Dubayy was
wbo siren /evei
The UAE arid Ihe Culf Cooperation Council The UAE sees the Culf Cooperation Council (GCQymbolic grouping of brethren Arab leaders,
ifiplomatic _khe UAEni such(he United Nations and ihe Arab League is increased by CCC membership. UAE leaders also welcome the CCCorumemonstrate publicly ibeir unity
Looking Again at Other Arab Countries Throughout, the UAE gave political, rhetorical, snd financial backing to Arab causes. The UAE supported3 oil embargo against the West, criticized Egypt for accepting the Camp David accords with Israel, and voted for the "Zionism is racism" resolution in the United Nations. The Palestinian issue was especially popular, and federation leaders donated large amountshe Palestine Liberation Organization (PLO
with oiher Arabs and io enjoy iheha!GCC meetings. The UAE tries io avoidby using the GCC when it pursues controversial policies. For example, in} it backed the GCC decision toepresentative to IheB^H
From an original base o( private commercialooperation between Ihe UAE and the United States has evolvedtronx security relationship The
prompt US response to the Iraqi invasion of Kuwait convinced UAE leaders that the United States would stand beside them and that closer lies to Washington were needed io ensue ihe feCcraticr.'s sccurir
Tbe UAE's Importance lo Ihe United Stales The United States derive* direct economic and ty benefits from its relationship with the UAE.
Ithe United States dominates sales of oilcigarettes, and motor vehicles andercent of the country's total imports0 The United States receivedercent of the UAE's exports0 and overall imi
The United States derives considerable indirectfrom its relationship with the UAE. The UAE's strategic location on the Strait ofwhich much of Ihc West's oilit an important factor in ensuring free passage through the Persian Gulf Politically, the UAE isxec of moce'ation in Arab councils. For example, theagreed with other Gvlf Cooperation Council states toepresentativehe US sponsored Arab-Israeli peace conference The UAE alsoEgyptian President Mubarak's plan for ending
the Arab boycott of Israel. Although the United Statesy^^rnal^ercentage of its total oil from Ihe UA < United Statesital interest in denying potential adversaries control of UAE reserves, which are more, percent of the world's proved resource
The federation isilateral security arrangement with the United States. Such anwould help Ihe United Stateselcr Iranian or Iraqi efforts to dominate ihe Gulf and the security of Ihe Strail of HonnuaJ
Tbe UAE's confidence in the United States was reaffirmed by the events leading upraq's invasion of Kuwait. Infter Saddam Husayn threatened Kuwait .ad the (JaE for eiceedine their OPEC
UAE officers have^ndicaterTTdeTyTn the United
UAE and the United States are discussing rity cooperateOriginal document.