International trade and economy of United Arab Emirates

International trade and economy of United Arab Emirates
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International trade is vital as it builds trade relations and can lead to economic growth or improvement in terms of trade. For United Arab Emirates, international trade has been an important part of the nation before and after the discovery of oil. Historically, the main form of trading in the UAE has been pearl trading. Furthermore, international trade has expanded in the country following the merger of seven states in 1971 that now fall under the UAE, both Dubai and Abu Dhabi play significant roles in the country both politically and economically. In the economic development of UAE, the role of natural resources has been prominent especially oil and gas (Abed, 2001).
Before the recession of 2008/2009, the UAE had undergone tremendous growth based on revenues from the petroleum industry. In essence, since the emergence of the country the reliance on oil revenue has allowed the country to participate in the global economy through the sale of oil to her trading partners and importation has also increased over the years. In addition, increased oil revenue has helped the country to build infrastructure as well as diversify from being oil dependent. According to the World Bank (2013) the current GDP in US$ of the UAE has increased throughout the years from 43, 598,747,467 in the year 1980 to 75,674,338,445 in 1998 to 314,844,665,222 in 2008.
Other economic indicators also show that the economy has expanded over the years. The aggregate demand which constitutes GDP expenditure including, government, investment, consumer expenditure and net exports constitute the aggregate demand. Consumption expenditure rose from US$ 68.7 in 2005 to US$ 115.8 in 2008, and total government expenditure rose from US $ 26.7 in 2005 to 46.2 in 2008 (Balian, 2010). The aggregate supply of the UAE also corresponds to the increase in the total output over the years. The corporate profits of UAE are mainly represented by the oi...