By Adam Gonn/Abu Dhabi
Abu Dhabi, the capital of the United Arab Emirates, is set to invest $1tn on various infrastructure projects in the city. The emirate, the world’s fourth largest oil producer with some 10% of the world’s proven oil reserves, has announced plans to boost its infrastructure by building new power plants, a light rail network, new roads and housing.
The $1tn sum represents approximately 17% of the national budget and, as a small comparison, could buy 833 of the newly commissioned USS New York warships or run the New York Metropolitan Transportation Authority for 90 years.
“It’s huge,” Yadullah Ijtehadi, managing editor of ABQ Zawya business news site, told The Media Line. “Abu Dhabi is now one of the few oases of opportunity in a world where opportunities are hard to come by at the moment.”
“I think they have been lagging behind in their infrastructure,” Ijtehadi said. “If you look at Abu Dhabi’s real estate market, there is a desperate shortage of housing, which is not the case in Dubai.”
“Obviously they (Abu Dhabi) want to show that they are a powerhouse,” Ijtehadi added, “which is why they have gotten into such high profile assets such as buying (English soccer club) Manchester City and hosting Formula 1.”
Last week Abu Dhabi hosted the final race in this year’s Formula 1 season in the newly built Yas Marina circuit, built over three years at an estimated cost of $40bn.
“It’s part of a package announcing to the world yes we are here, we are far more sound than Dubai and we are ready to spend some money,” Ijtehadi said.
The two emirates, Abu Dhabi and Dubai, are often seen as competitors for a place in the global spotlight. Since oil was discovered by the British in the 1960s, the path that each emirate has taken has been very different.
While Dubai, with its smaller oil reserves, was the first emirate in the region to diversify its economy away from oil by investing in tourism, finance and real estate, Abu Dhabi, with its much larger oil reserves, did not set off until more recently.- The Media Line
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