High Performance Government:
UAE Ministry of Finance and Industry

Title: “From Aspiration to Reality”
  

INTRODUCTION

The United Arab Emirates (UAE) is proud of its long and vibrant history – a history that has seen a small, traditional trading community grow into one of the most dynamic and cosmopolitan business centres of the Middle East. It is also highly optimistic about its future and its ability to assist in the regional development process.

We are extremely pleased to be able to welcome the global financial community here to the UAE at a very significant moment in the history of the Middle East. A combination of external and internal forces are now creating a new perspective on how the Arab world can pursue sound socio-economic development. We believe that this has to be a united region wide effort and that only through continual dialogue and mutual exchange of policy ideas, can we truly achieve a sustainable model.

We also believe that it is only through partnership with our international peers and international development organizations such as the World Bank, the International Monetary Fund and the United Nations, that we can fast track the process by learning from the experience of other nations.

Here at the Ministry of Finance and Industry we have had the pleasure of working very closely with the world’s financial and development institutions on a regular basis. And we have witnessed first hand the value of their expertise and guidance in economic policy initiatives. We have also understood the value of strong and visionary leadership – leadership that cannot only oversee positive change processes but that can also create a strategic plan for the future.

This document aims to take you on a journey – the journey that we undertook at the Ministry of Finance and Industry that led us from our initial discussions with the IMF and the World Bank and indeed, our internal discussions about how to achieve high performance government, to where we are today.

Today is more than just the ability to host Dubai 2003 here in the Middle East. For us at MOFI, it is also about a commitment to sound economic policy and a tangible efficiency drive. It is about being able to respond flexibly and effectively to our constituents – to our people – and about making economic policy a positive work in progress rather than a structural hindrance.

Over the past four years, MOFI has undertaken a series of initiatives aimed at achieving high performance governance across the totality of our operations and those of our affiliates. We believe that the presence of the global financial community here in the UAE stands testimony to this drive and endorses the direction of our efforts.

H.E. Sheikh Hamdan bin Rashid al-Maktoum,
UAE Minister of Finance and Industry, Deputy Ruler of Dubai

Dubai 2003 – Building Consensus

Welcoming the world’s global financial community to the heart of the Middle East for the first time in history – hosting the 58^th Annual Meetings of the International Monetary Fund and the World Bank Group in the UAE – brings not only a wealth of opportunity to the region and the world of finance but also stands testimony to hard work, vision and a commitment to qualitative change.

For over three decades, the UAE has enjoyed an excellent relationship with the two global organisations. It became a member of the IMF in 1972 and in the same year also became a signatory to the International Bank for Reconstruction and Development, the first body under the World Bank umbrella that the UAE was to join. The UAE has also joined several other World Bank organisations and has become an active contributor to both institutions.

But getting to Dubai 2003, was about more than simply building on a very strong professional relationship. It was also about building consensus about the suitability of the UAE as a host country. And it was about building a connection between the economic success of the UAE and the huge potential for the region.

In 1996, the Ministry of Finance and Industry (MOFI), approached the Bretton Woods institutions for the first time with a view to inviting them to nominate Dubai to host the Annual Meetings in 2000. A technical mission from the Joint Secretariat visited the UAE in 1998, and reported favourably on Dubai’s progress and suitability. While a decision was eventually taken to host the 2000 Annual Meetings in Prague in the Czech Republic, by this time the Joint Secretariat had already confirmed the UAE’s suitability as a host nation.

 

 

 

 

 

 

 

 

 

In 1999, H.H. Sheikh Hamdan bin Rashid Al Maktoum, Deputy Ruler of Dubai, UAE Minister of Finance and Industry, confirmed in writing to the World Bank Group, the UAE’s official invitation for the year 2003.

Through a process of consensus building – which led to Egypt voluntarily ceding regional representation to the UAE in 1998 – during the 1999 Annual Meetings in Washington D.C., the Board of Governors confirmed Dubai as the host of the 2003 Annual Meetings. Given that the resolution was adopted at the plenary session with no explicit vote taken, the decision was considered unanimous.

On 30 September 2000, a Memorandum of Understanding was signed in Prague between James Wolfensohn, President of the World Bank, Horst Köhler, Managing Director of the IMF, Mohamed Khalfan bin Khirbash, Minister of State for Finance and Industry and Sultan bin Nasser Al Suwaidi, Governor of the Central Bank of the UAE. In 1999, the Planning and Follow-up Committee was established for the meeting while in the year 2000 both the Organising Committee and the Steering Committee were established headed by H.E. Qassim Sultan, Director General, Dubai Municipality and H.H. Sheikh Hamdan bin Rashid al Maktoum, Deputy Ruler of Dubai Minister of Finance and Industry, respectively. The 184 member countries will take part in these global meetings of minds at Dubai 2003.

 

 

 

 

A Dynamic Heritage – A Progressive Future

The unification of the seven emirates in 1971 – Abu Dhabi, Dubai, Sharjah, Ras al-Khaimah, Ajman, Fujairah and Umm al-Qaywayn – saw the creation of a distinct national identity in the UAE. Since then, the country has undergone profound social, demographic and environmental change largely driven by visionary leadership and notably His Highness, President Sheikh Zayed bin Sultan al Nahyan. Over the past three decades the country has emerged from a traditional society into a dynamic international business centre.

The work of the UAE Ministry of Finance and Industry (MOFI) and the drive towards improved performance and modernization is indicative of this change whereby in the space of three decades the UAE has grown fifteen fold from a small population to one that comprises over 3.7 million people. The country prides itself on its cosmopolitan make-up, which combines nationalities from all over the world and creates a critical mass of world-class professionals.  Here, technology, real estate development, tourism, trade and manufacturing all compete to promote an atmosphere of competition and excellence. Quality and service are at the centre of all that the people of this country stand for.

The UAE population has witnessed very significant qualitative and quantitative improvements and now reports levels of infant mortality and life expectancy on a par with other developed nations. Female fertility rates are falling as women receive greater access to education. Indeed, women are encouraged to play a full and meaningful role in UAE society and are actively involved in the public sector in many realms.

Out of 24 federal ministries, national female employees comprise 28 per cent of the total civil servants. Women are particularly conspicuous in the provision of health and education services comprising 41.5 per cent of the educational workforce and 34.2 percent of the health care one, but are also active in sectors less traditionally associated with women. Female taxi drivers, military officials and security officers can all be found in the UAE. Women are also being encouraged to take an active role in the business world with the establishment of the UAE Businesswomen Committee in 2001.

The country’s pro-active stance on investing in human capital – both male and female – has meant that the UAE now boasts the highest level of literacy in the region at 93%. The UAE’s Education 2020 Strategy is indicative of its commitment to providing quality education with a series of five year plans designed to introduce advanced education techniques. Technology and connectivity are critical components of this and the country’s educational system now has one of the highest levels of Internet penetration in the region. Student/computer ratios stand at 10:1 in kindergartens, 5:1 in primary schools; 2:1 in preparatory schools and 1:1 in secondary schools.

Promoting human capital is also directly related to investing and protecting the environment – an area where the UAE has been particularly committed participating in global forums and notably the World Summit in 2002. The Federal Environment Agency has established a National Committee for Biodiversity and actively works to ensure that legislation helps to reduce pollution and protect endangered wild life. H.E. Sheikh Zayed has personally overseen the development of a comprehensive environmental policy in the country in a bid to protect its very unique and special natural heritage.

Social developments have been grounded in a long-term strategic approach to economic ones and in the ability to successfully manage the explosion of oil and gas exports to create a truly solid foundation for sustainable development. While the UAE’s oil wealth forms the backbone of the Federation’s economy, it is no longer the key component.

The UAE is prepared for the day when black gold ceases to flow and now boasts one of the most diversified economies in the region. It has also become a key regional player and has developed excellent relations with fellow Arab nations and regional institutions that aim to help promote prosperity, sustainability and generally a better quality of life throughout the region.

This philosophy has driven the UAE’s contributions as a donor nation to help those countries less well endowed with natural resources. For over three decades the UAE has generously contributed to economic and social development projects in developing countries as well as supporting them to implement financial and economic reform programmes. The UAE provided an annual average of 3.6 per cent of its GDP over the past three decades in foreign aid having disbursed a total aid of over AED100 billion ($27.2 billion) since 1971.

The Abu Dhabi Fund for Development (ADFD) was established in July 1971 with the aim of providing loans, grants and technical aid on easy terms to Arab, Muslim and other developing countries, in order to enable them to carry out their development plans. The Fund has contributed loans and direct investments of some AED919 ($250 billion) to 56 Arab, African and European states for the purpose of financing 240 projects. These involved the implementation of a wide variety of infrastructure projects, including agricultural, industrial, transport, rural development, housing, water, electricity, road, port, dam and tourism projects.

The UAE is a member of the following development funds:

q       Arab Monetary Fund (Federal Decree 35, 1988)

q       Arab Fund for Economic and Social Development (Federal Decree 97, 1982)

q       OPEC Fund (Federal Decree 56, 1976)

q       Arab Bank for Economic Development in Africa (Federal Decree 83, 1974)

q       International Fund for Agricultural Development (Federal Decree 19, 1979)

q       Islamic Development Bank (Federal Decree 91, 1974)

q       Islamic Corporation for the Insurance of Investments and Export Credits (Ministerial Decree 2/407, 2000)

q       Islamic Corporation for the Development of the Private Sector (Federal Decree 70, 2000)

q       Arab Fund for Investment Guarantees (Federal Decree 45, 1974)

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