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From all four short cases regarding Expo 2020, highlight and explain that how it is beneficial for UAE economy?
Expo 2020
UAE is still significantly an oil economy and the administration of the UAE is looking to find ways to diversify the economy from an hydrocarbon economy to a non-oil based economy. It is widely believed that the emphasis is being put on creating a service economy in the next 2 decades and Expo 2020 would provide an opportunity to the UAE government to increase and build infrastructure in the field of hospitality and travel sector and also to augment manufacturing sector at the same. More than 190 nations are likely to take part in the Expo and the participation is likely to bring joint ventures in the field of technology acquisition and research and development etc.
Benefits for the UAE economy
The first and foremost benefit of Expo 2020 is likely to come int the form of creation of a huge no of jobs for the UAE population. Jobs would be created in fiancé, banking, transport, insurance and manufacturing sectors apart from hotel and travel industry. More than 300,000 jobs are expected to be created and the same would go a long way in increasing the aggregate demand in the economy giving a Philip to the GDP growth.
An estimated 25-30 million foreign travelers would visit the expo during the six-month duration and that would provide an opportunity to the Dubai and UAE an opportunity to expand the hotel and hospitality industry. Transport sector and tourist hubs would be developed, and infrastructure would be put in place to cater to a growing no of visitors to the country in the coming years and jobs would be created in the ancillary sectors as well. Hotels and other luxury service apartment sector would be able to generate a higher capacity utilization and profitability is also likely to go up.
As of 2017-2018, the real estate sector of the economy is enduring a long-term recessionary pressure. But as expo 2020 is held and a large no of commercial and manufacturing joint ventures are entered into in UAE ( not just in Dubai) the same is expected to increase the demand for not only residential real estate but also commercial space and manufacturing hubs would also be in demand. As a result of the same the sluggish real estate is likely to grow rapidly and prices would be expected to rise to pre-2013 level. The same would be instrumental in new projects being undertaken as well (Martin Hvidt, 2015).
As more and more manufacturing industries and financial sector industries would be set up in both Dubai and Abu Dhabi, it is expected that foreigners who set up their offices and hubs in UAE are mot likely to remain in UAE after their retirement and increase demand for various goods and services. This is more likely to increase the confidence of expatriates form other countries to come and set businesses in UAE and help grow the UAE economy. Expo 2020 is expected help in the faster diversification of the economy.
A huge no of new projects are now under various stages of construction and would be finished in a few months time. As Expo 2020 is held and new contracts are entered the same would mean new contracts would be entered into and new projects would also grow. The same would require ancillary manpower for more than half a million in various sectors of the economy. As businesses form various countries would come and set up their businesses the same provides an opportunity to the UAE economy to train the workforce including the expatriates to be more skillful and more productive. More paying jobs would be created in the near future leading to UAE economy’s higher GDP growth for a long period of time and attracting higher FDI as well for further expansion and diversification (Anyaehie, 2016).
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