TURNING THE SHIP AROUND

Abu Dhabi 2017 | ECONOMY | FOCUS: KNOWLEDGE ECONOMY

The government of Abu Dhabi, in coordination with the Executive Council, is investing heavily in a shift from an oil-based economy to a knowledge-based economy, where information supersedes commodities and the highest form of capital is human capital.

One of the first major investments in Abu Dhabi's knowledge economy occurred in 2007 with the creation of Takamul by the Abu Dhabi Technology Development Committee (TDC). Takamul, which is Arabic for integration, is a strategic initiative designed to support innovation in Emirati individuals, businesses, and universities. Takamul directly encourages innovation and inventiveness by providing legal and financial support for international patent filing within knowledge intensive industries such as clean-tech, health and medical, ICT, and oil and gas.

Over the years Takamul has developed a reputation for reliable and successful relationships among a diverse group of Emirati innovators. In 2014, the TDC signed a partnership with the Abu Dhabi National Oil Company (ADNOC) to develop intellectual property (IP) and manage its IP portfolio. The agreement is testament to Takamul's success over the last four years in developing awareness and support for IP. ADNOC sought to take advantage of its expertise in the area to develop its own IP base within its R&D department.
Perhaps the single-largest monetary investment in the knowledge-based economy to date is the Emirates Science, Technology and Innovation Higher Policy, which allocates over AED300 billion across 100 initiatives to promote growth within sectors such as education, health, energy, transportation, space, and water. The policy mandates the establishment of funds for science, research, and innovation in the UAE to encourage the growth of an organic knowledge economy based on technology transfer, intellectual property, and global industrial partnerships. The policy, in coordination with other efforts across the UAE, has set the target for knowledge workers to constitute 40% of the national labor force by 2021.

In December 2016 the Securities and Commodities Authority (SCA) annual conference mirrored the demands and expectations, focusing on “the Role of Financial Markets in Building an Economy Based on Knowledge, Innovation, and Happiness.” Similarly, the aviation industry's growth in recent years is testament to changing attitudes, developing a world-class center for aviation manufacturing in Abu Dhabi.

Renewable energy is also a major focus of Abu Dhabi's plan for a sustainable future and a diversified economy. In 2016 the UAE was the first Middle Eastern country to ratify the Paris Agreement on Climate Change, signifying a major shift in the UAE from a traditionally oil-based economy toward more sustainable business practices. The Minister of Energy announced that by 2030 it wants 30% of its power generation to come from clean energy. Four nuclear power plants, each with a capacity of 1,400MW, are expected to be fully operational by 2020. The remainder of its clean energy will come from solar energy.

While there are several private companies already making waves in the renewable energy market, the government is also interested in the sector. The Mohammed bin Rashid Al Maktoum Solar Park is one of the largest single-site strategic solar energy projects in the world. This shift in focus is coming at the perfect time as the interest in renewable energy is at its peak following COP21 and, more importantly, continually sluggish prices in the commodity market are turning idle eyes away from oil.

Abu Dhabi is making massive strides in its effort to establish a diversified and knowledge-based economy. The government is laying the groundwork to support the 21st century's shift away from oil and electricity fueled by gas and in doing so is enthusiastically investing in young Emiratis' education and the fields of research and innovation. On that back of events such as the Takamul Defense Innovation and Technology Conference (DITEC) in 2015, when international specialists in areas such as science, technology, and innovation were gathered in Abu Dhabi, creating a platform for discussion and progress within the industry, Abu Dhabi's public and private sector are engaging with the knowledge economy and making it a reality.