Currency:Emirati dirham (AED)

Economy Overview: The UAE has an open economy with a high per capita income and a sizable annual trade surplus. Despite largely successful efforts at economic diversification, nearly 40% of GDP is still directly based on oil and gas output.

Since the discovery of oil in the UAE more than 30 years ago, the UAE has undergone a profound transformation from an impoverished region of small desert principalities to a modern state with a high standard of living. The government has increased spending on job creation and infrastructure expansion and is opening up utilities to greater private sector involvement. In April 2004, the UAE signed a Trade and Investment Framework Agreement with Washington and in November 2004 agreed to undertake negotiations toward a Free Trade Agreement with the US. The country's Free Trade Zones - offering 100% foreign ownership and zero taxes - are helping to attract foreign investors.

Higher oil revenue, strong liquidity, housing shortages, and cheap credit in 2005-07 led to a surge in asset prices (shares and real estate) and consumer inflation. Rising prices are increasing the operating costs for businesses in the UAE and adversely impacting government employees and others on fixed incomes. Dependence on oil and a large expatriate workforce are significant long-term challenges. The UAE's strategic plan for the next few years focuses on diversification and creating more opportunities for nationals through improved education and increased private sector employment.

GDP (purchasing power parity):$167.3 billion (2007 est.)

GDP (official exchange rate):$192.6 billion (2007 est.)

Unemployment rate:2.4% (2001)

Population below poverty line:19.5% (2003)

Industries: Petroleum, and petrochemicals; fishing, aluminium, cement, fertilizers, commercial ship repair, construction materials, some boat building, handicrafts, textiles

Industrial production growth rate:4.3% (2007 est.)

Exports - partners: Japan 25.8%, South Korea 9.6%, Thailand 5.9%, India 4.5% (2006)

Fiscal year:Calendar year

Source: The World Factbook