UAE the Global Village Term Paper

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UAE the Global Village

It is estimated that about 240 different cultures live in the UAE today. This means that almost all the cultures in the world are represented in the UAE making it a Global Village. The paper focuses on the question: How has globalization impacted the culture of the UAE? The paper compares the effectiveness and impact of globalization on UAE's economy and culture. Lastly, this paper also examines globalization and its impact on UAE and points out the positive and negative impacts of globalization.

Impact of globalization on UAE has been mixed with both negative and positive implications of global integration.

The population of Saudi Arabia is about 27.6 million people, whereas the neighbouring country of UAE (United Arab Emirate) although has the population of approximately 4.5 million, is considered a very good example of global village in the world. UAE has attracted the international community by undertaking remarkable development initiatives and adopting many innovative policies which has led it to become a global city (Abdullah, 2010).

It has become a glory with the towering sky scrapers and beautiful architectures. In this literature review, the social and economic challenges faced by UAE for successful globalization are discussed (Abdullah, 2010).

UAE comprises of seven states after becoming an independent country on 2nd December, 1971. The states representing UAE are: Abu-Dhabi, Sharjah, Dubai, Umm al-Qaiwan, Ajman, Ras-ul-Khaimah, and Fujairah (Abdullah, 2010).

Since 1820, United Arab Emirates was under the British control bound by a chain of treaties of which the General Treaty of Maritime is considered to be an important treaty, up until 1971 when it became independent (Abdullah, 2010).

Before independence, it was known as a trucial state because of that treaty. The region was very sensibly integrated by the British Empire without facing any responsibilities and administrative expenses which were then transferred to the tribal leaders of the region. Thus, the Empire obtained maximum financial benefits (Abdullah, 2010).

The founding leader of UAE was Sheikh Zayed Bin Sultan Al-Nahyan. In his tenure, UAE established the most, in terms of political stability and public policies enhancement. UAE flourished economically during the last thirty seven years which was unimaginable. As per the Human Development Report of UNDP (2007-2008), the UAE's per capita GDP rate is about $25,574. This rate is considered of a very high income economy as reported in the World Bank Report of 2008. This economic boom was because of the continuously increasing oil prices all over the world (Abdullah, 2010).

According to the Human Development Report (2007-2008) of UNDP, UAE was ranked at the 39th position among 177 countries like Slovakia and Chile. UAE was also rated as one of the least corrupt country of that region by Berlin-based Transparency International. According to the World Bank report, UAE scored 8.3 which is the highest governance rank in that region (Abdullah, 2010).

Thesis Claims and Arguments

Impact Global Village on UAE

Globalization enhances the interconnectedness among the countries especially in the areas of economics, cultures and politics. But studies are being conducted on the positive and negative impacts of globalization that whether globalization is beneficial for the countries or not. In this review, the focus is on the issues that how globalization has been beneficial to UAE and in which particular field.

By looking at the overall development of UAE, the researchers have observed that the globalization has turned UAE in a highly developed country in almost every field like education, infrastructure, technology and media etc. Overall globalization affected UAE positively in all possible aspects (Domluke, 2010).

The positive effects of globalization on UAE's economy have remarkably increased the foreign investment and free trade between UAE and other large economies. Domestic investments have also been encouraged (Domluke, 2010).

Globalization has brought an economic boom in UAE in the form of foreign investments. UAE achieved a record of about U.S.$10 million which was nearly 34% of overall foreign investment done in the Arab countries, as recorded in a survey report conducted in the year 2005 (United Arab Emirates 2007, p.76). The main reason behind this achievement is the political stability in UAE. The working rights of all business related people are preserved by giving them complete authority of buying and selling without imposing various taxes on their revenues and products. A total of 170 licenses were issued in the previous year in UAE to accept branches of different foreign firms, which was about 20% more than the number of licenses issued in the year 2005. According to James Bennett (2007, para3), 24 British companies, 13 German companies, 11 British Virgin Islands companies, 10 Indian companies, and 8 American companies were allotted these licenses respectively.

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. The economic virtues offered by UAE are acknowledged by businessmen worldwide, making it a hub for foreign investment. It is usually argued that foreign investment takes money out of the company and usually benefits the investors (Mankiw, 2004), UAE's capital stock has increased tremendously over the past few years on account of these investments which have in turn, resulted in an gradual increase in current capability of the UAE to produce ever increasing commodities and services alongside increasing the standards of living of its people.

There has been a considerable boost in the UAE domestic investment due to globalization. UAE is an active participant in many global markets through many investment institutions that include the Abu Dhabi Investment Council, the Dubai Port, Abu Dhabi's International Petroleum Investment Co., and the Dubai Holding, (United Arab Emirates 2007, 2007, p.76). Through globalization, UAE has been increasingly able to deal with already established countries such as the United Kingdom and the United States which help it understand the link between savings and a faster rate of growth utilized by other developed countries. Though, increasing the investments decreases the number of commodities available to the average consumer today, it is bound to largely enhance the same number in the distant future by many folds. There seems to be an existent trade-off between the present and the future consumption which is dependent upon aggregate savings and gross investment. To achieve a higher SOL in the near future, the global village will have to currently save more (Mankiw, 2004). Abu Dhabi plans on investing a total of Dh555 billion in the upcoming 5 years, of which, Dh320 billion will be allocated to construction, Dh120 to the development of the tourism industry, and a total of Dh80 billion on seeking to expand the natural resource sector. Furthermore, investments on hydrocarbon industries have increased as it seeks to create alternative revenues from sources independent of these natural reserves (United Arab Emirates 2007, 2007, p.81). The investment by UAE might cause some consumption hurdles at present, it is a long-term measure that is likely to lead to a brighter future for its citizens.

Free trade is being promoted between other countries and the global village of UAE because of rapid globalization. This trade has enabled UAE to invest goods from abroad that are much cheaper than those produced at home. Though foreign goods, or imports, hurt domestic producers as demand for their products fall and they are likely to lay off workers, thus increasing the rate of unemployment (Mankiw, 2004), it is also possible that it creates more job opportunities in other profitable industries of UAE such as those of oil and those of gas. A total of 170 licenses were issued in the previous year in UAE ). The economic virtues offered by UAE are acknowledged by businessmen worldwide, making it a hub for foreign investment. It is usually argued that foreign investment takes money out of the company and usually benefits the investors (Mankiw, 2004), UAE's capital stock has increased tremendously over the past few years on account of these investments which have in turn, resulted in an gradual increase in current capability of the UAE to produce ever increasing commodities and services alongside increasing the standards of living of its people.

There has been a considerable boost in the UAE domestic investment due to globalization. UAE is an active participant in many global markets through many investment institutions that include the Abu Dhabi Investment Council, the Dubai Port, Abu Dhabi's International Petroleum Investment Co., and the Dubai Holding, (United Arab Emirates 2007, 2007, p.76). Through globalization, UAE has been increasingly able to deal with already established countries such as the United Kingdom and the United States which help it understand the link between savings and a faster rate of growth utilized by other developed countries. Though, increasing the investments decreases the number of commodities available to the average consumer today, it is bound to largely enhance the same number in the distant future by many folds. There seems to be….....

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